The business secretary, Kwasi Kwarteng, has asked the UK’s competition watchdog to urgently review petrol station operators, amid concerns that retailers have not passed on the recent cut to fuel duty.
In a letter to the Competition and Markets Authority (CMA), Kwarteng wrote that people were “rightly frustrated” that the 5p-a-litre reduction had not stopped prices from soaring to record levels at forecourts.
Kwarteng asked the CMA to conduct an urgent review of the fuel market, and a longer-term study that would examine the health of competition in the market, to examine whether it has hurt consumer interests amid rising prices.
He noted regional disparities in petrol prices, and asked for an initial report of recommendations to “strengthen competition” in the petrol market by 7 July.
“Drivers should be getting a fair deal for fuel across the UK,” Kwarteng wrote.
“I am writing to you to ask that the CMA conduct an urgent review of the fuel market … to explore whether the retail fuel market has adversely affected consumer interests.”
Fuel prices⛽️
I’ve asked the @CMAgovUK to conduct an urgent review of the retail fuel market, as well as a longer-term investigation under the Enterprise Act.
Fuel prices are always quick to go up but slow to come down – let’s see why. pic.twitter.com/iBk8JeNcsF
— Kwasi Kwarteng (@KwasiKwarteng) June 12, 2022
The competition watchdog had previously made Asda and Morrisons sell a number of forecourts during private equity acquisitions.
The average price of a litre of petrol at UK forecourts rose by 7p last week, according to data firm Experian Catalist, hitting a new record of 183.2p on Thursday. That pushed the cost of filling a typical car over the £100 mark.
Petrol retailers have blamed surging wholesale prices, saying oil refineries had not passed on a fall in the price of crude oil since the highs during the early days of the war in Ukraine.
Why filling up the average family car in the UK has topped £100Read more
Jack Cousens, the AA’s head of roads policy, welcomed Kwarteng’s move but called for “more urgent action”.
“To relieve pressure at the pumps we need an immediate 10p cut to fuel duty,” he argued.
“Longer term, the CMA should consider extending the pump price transparency available in Northern Ireland to the rest of the UK. The Consumer Council’s fuel price checker stimulates competition and has led to drivers there enjoying the lowest fuel prices in the UK,” Cousens said.
Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk
Trade unions and drivers have warned that the record increase in fuel prices could force staff who rely on their vehicles for work to quit, including essential workers.
One community NHS worker said that the fuel price rise had outstripped the reimbursement they were given for petrol costs, so staff were now paying not just to get to work, but also to drive to patients’ houses to do their job.
Rising petrol prices have led to an increase in the number of drivers trying to drive off without paying, with forecourts facing up to three attempted thefts a day on average, figures from industry body Forecourt Eye show.
