Against a backdrop of a small upward trend in petrol prices recently, the AA have stepped out and said that motorists are suffering from the effects of “oil company greed.”
In a report in The Belfast Telegraph, AA president Edmund King has once again criticised the fact that garages tend to quickly raise prices when oil costs move upwards, but are far slower to act when the oil price changes in the opposite direction. This is a phenomenon widely referred to as the “rocket and feather effect.”
This time, King has singled out mainstream garages and pitted them against the supermarkets, saying that the supermarkets brought prices down more quickly when oil prices fell and are now “reluctant” to raise them in the wake of increases.
This certainly rings true based on some ews we announced yesterday, referring to the fact that Sainsbury’s is launching a voucher promotion that, at least temporarily, will allow many motorists to purchase petrol at less then one Pound per litre, so long as they do a grocery shop in a Sainsbury’s store worth at least £30.
The RAC seem to agree with the AA, with spokesman Simon Williams saying that retailers have “quietly passed on” their own price increases. However, with the supermarkets piling the pressure on, other garages will surely have to do something to compete, or they will risk seeing their forecourts deserted while motorists queue at the supermarkets!