Price cut makes diesel cheaper than petrol

On 9 July – the day after George Osborne froze fuel duty once more in the summer budget – Tesco, Sainsbury’s, Morrisons and Asda all typically cut the cost of diesel by 2p per litre at their combined total of 1,400 filling stations.

It said the reduction – which is likely to trigger similar moves by rivals – meant that for the first time in 14 years, average diesel prices would be cheaper than unleaded.

“Because of the recent price drops in the wholesale diesel price, we are able to pass on these savings to our customers”.

A litre of diesel there is 113.7p – just 1p cheaper than a litre of unleaded, which costs 114.7p.

Andy Peake, Asda’s senior director for petrol, said: “Asda cutting another 2ppl on diesel is great news for our drivers, meaning they will pay no more than 112.7ppl at any Asda forecourt, every single one of our customers knows the maximum price they will pay at the pump regardless of where they live. Many younger drivers won’t remember the last time that diesel prices were lower than unleaded”.

However, there will be “a handful” of Morrisons filling stations where diesel prices will remain higher than unleaded because of “local competitive factors”.

Simon Williams, spokesman for RAC fuel, said: “With the price of crude oil standing at $56.50 and the pound relatively strong against the USA dollar – the fuel trading currency – there is scope for further price cuts of up to 4p per litre off diesel over the next fortnight, and unleaded may even benefit from a slight reduction too due to the continued oversupply of oil”.

Motoring organisations, including the RAC, have criticised fuel retailers for not passing on savings from the drop in wholesale prices on diesel.

Steve Gooding, director of the RAC Foundation, said: “This is good news for the ten million or so diesel car drivers, but our analysis shows it could have come weeks ago”.

“Throughout June the wholesale price of diesel has been below that of petrol yet this has not been reflected at the pumps”.

It is welcome relief for the nation’s 11million diesel car drivers, who have had to shell out up to 6p a litre more than petrol car owners since April.

In July 2001, diesel cost 77.92 pence per litre on average, compared with 77.94 pence for a litre of petrol, reported by Experian Catalyst data.

According to the latest data at website PetrolPrices.com, Asda’s Spondon site sells the cheapest diesel and unleaded in Derby.