Experts predict a boost for motorists as fuel prices plummet

Pump prices falling to below £1 a litre?

MOTORISTS COULD CASH in on fuel prices that are being tipped to fall below £1 a litre after another supermarket price war got under way this week.

Three major fuel retailers – Asda, Tesco and Morrisons – have already cut their pump prices by 2p a litre this week with Sainsbury saying they will follow suit from today.

A spokesman for Asda has said that their latest price cuts would see customers paying no more than 109.7p a litre no matter where they live – meaning that the price at their pumps has fallen by 5p for unleaded fuel in the last month.

While diesel has been falling in price steadily to the point where it has dropped below that of unleaded fuel, industry experts say that is about to change with RAC spokesman Rod Dennis pointing to the falling wholesale price for unleaded.

He said: “The reason we have been slower to see unleaded cuts is because the wholesale price of petrol, the price retailers buy fuel for, has not fallen at the same rate diesel has.

“Diesel has been on a steady downward path since the start of May which has been driven by an increased capacity from Asia – but the same cannot be said for petrol. If the conditions stay right then we could see some even lower prices in a few weeks as people return to work after the summer and the school run begins again.”

The news on prices has been welcomed by the RAC Foundation for whom a spokesman agreed more cuts could be expected: “The retail margin on petrol is almost twice as much as the long-term average, which is another indicator pump prices could fall further.”