UK retailers too slow to pass on fuel price falls, watchdog says

Competition and Markets Authority raises concerns about ‘passive pricing strategies’ used by some petrol stations

Some petrol stations are still not passing on changes in wholesale prices quickly enough and more than 1,000 warning letters have been sent to retailers failing to give prices to the Fuel Finder service, the UK competition watchdog has said.

The Competition and Markets Authority (CMA) raised concerns in its latest quarterly update on the fuel market over “passive pricing strategies” used by the majority of retailers, which it said were helping to keep profit margins high amid soaring cost pressures on drivers from the Iran war .

It found some retailers did not immediately pass on falls in wholesale diesel prices to drivers between May and June, which could have boosted competition in the market.

The CMA said that while costs overall fell at fuel pumps in June, prices remained significantly higher than before the Middle East conflict and retailer profit margins were either at or above the historically high levels of 2025.

It did not find any evidence of profiteering among fuel retailers on the back of the war in Iran.

The CMA also said it had sent 1,166 letters to retailers and 53 compliance notices since April about failure to register with the government-run Fuel Finder price comparison scheme.

It said about 97% of petrol stations are registered with the scheme, which account for about 99% of the fuel sold in the UK, and it had not yet had to issue any fines.

It said it would carry out a more detailed review of the road fuel market in the autumn to ensure customers were paying a fair price for fuel across the UK.

The CMA’s chief executive, Sarah Cardell, said: “We know prices at the pump are putting real pressure on drivers’ pockets and our monitoring plays an important role in giving drivers confidence that retailers are not taking advantage of the conflict in the Middle East.

“We will continue to monitor prices and margins closely and expect any reductions in wholesale prices to be rapidly and fully passed on to drivers.

“In the meantime, Fuel Finder can help drivers save money when they fill up.”

The AA said the CMA’s update “once again highlights some failures to not charge a fair price for petrol and diesel – at the expense of everyday drivers”.

The AA’s president, Edmund King, said: “Clearly, some fuel retailers are prepared to pass on lower costs promptly and help their customers.

“But many more, including large numbers of supermarkets, are not.”

He praised the Fuel Finder system as a “start in getting drivers to fight back against stubbornly high petrol and diesel prices”.

Fuel Finder was created on the back of a CMA recommendation in July 2023. The watchdog had found competition among retailers had weakened since 2019, with drivers paying nearly £1bn more for fuel at supermarkets during the previous year because of increased margins.

The scheme is run by the government and the technology company VE3.

The RAC’s head of policy, Simon Williams, said: “It’s very concerning that margins on fuel remain historically high, competition is still lacking and that some retailers were deemed not to have reduced prices as quickly as they should have when the diesel wholesale price fell earlier in the summer.

“We’re therefore pleased the CMA is going to be taking a closer look at retailer pricing strategies and whether wholesale price changes are reflected at the pumps fast enough.

“We also urge the watchdog to compare fuel retailing in Northern Ireland with the rest of the UK, as petrol and diesel are currently being sold there for an average of 8p less a litre – meaning the cost of filling a family car in Northern Ireland is around £4.40 less than elsewhere.

“If fuel can be sold there at lower prices, then it seems drivers elsewhere aren’t being treated fairly.”