Supermarket giant Asda confirmed this morning (26th September) that they have reduced their national price cap on unleaded by two pence a litre, bringing it down to 126.7ppl. Morrisons were quick to follow and announced that they were cutting unleaded on all forecourts by up to two pence a litre. Sainsbury’s have also hopped on the bandwagon, and from Friday 28th September will be cutting unleaded by up to 2p a litre. Late on Wednesday afternoon, Tesco announced that they too would be cutting the cost of unleaded by up to 2p a litre.
This national price cap means that petrol drivers can expect to pay no more than 126.7ppl in Asda forecourts from the 26th September, a welcome relief from the sky-high prices we have seen recently, which are the highest in four years. For Morrisons, Tesco and Sainsbury’s customers, a welcome maximum two pence a litre drop will also help to ease the burden.
What started the price war?
A drop in the cost of wholesale has meant that supermarkets, who are often the quickest to respond to drops, are able to cut prices drastically overnight. While oil prices are still rising the wholesale cost has dropped, and the response from brands is a positive way of passing on the savings.
Asda was first to announce a drop on Wednesday 26th in the morning, and their cut took immediate effect, Morrisons came in a close second, with an announcement shortly after. The Morrisons cut kicked in on Thursday 27th along with the Tesco cut, and Sainsbury’s the day after with their drop starting on the 28th of September (Friday).
In the last twelve months, eight of them have seen a rise in the cost of filling up. At the end of August, the prices hit a four year high with the average litre of unleaded costing 130.2ppl and the average litre of diesel costing 132.8ppl. While this is mostly unchanged at the end of September, with the modal average litre at 129.9ppl for unleaded and 133.9ppl for diesel, the prices are still high compared to this time last year. In September last year, the average litre of unleaded was 119.3ppl, and the average litre of diesel was 120ppl.
The price of oil dropped to $71 a barrel in Mid-August, and it seems these savings have finally been passed down to the motorist.
Response from supermarkets
Data from the PetrolPrices database, dated 25th September 2018, shows that the average price for supermarket brands nationwide is in line with the national average, but some are much lower.
Asda’s modal average price on the 25th September was 126.7ppl, showing their price cap starting early, Sainsbury’s were a few pence behind at 129.9ppl, and then Morrisons and Tesco brought up the rear at 130.9ppl.
Asda’s Senior Fuel Buyer, Dave Tyrer, said: “Today’s latest move shows that Asda is once again cutting the cost of filling up for motorists following a decrease in the wholesale costs on unleaded. Our new national price cap of 126.7ppl will be welcomed by the millions of drivers across the UK who has seen prices rise by 10 pence per litre since the start of summer and are currently at their highest for five years.”
Ashley Myers, Head of Fuel at Morrisons, said: “We always try to keep our fuel prices as low as we can, and far below the UK average.”
Karen O’Connor, Category Manager for Sainsbury’s, said: “We are committed to helping our customers live well for less whether they’re stocking up on groceries or refuelling their cars and that’s why we’re dropping the price of unleaded petrol from Friday. Whether in-store or at the pumps, customers know they will get fantastic value with Sainsbury’s.”
Tesco has confirmed a price cut of up to 2p a litre that came into effect 27th September, and did not pass on an official comment.
At the moment, the longevity of this price cut is uncertain. The cheaper oil at the end of August going into the beginning of September rose steeply afterwards and with it now sitting at around $80 a barrel, it is unlikely that this drop will remain around for a sustained period of time.
If you’re lucky enough to need a fill up as payday approaches, then you are in luck. The price cuts should all be in full effect, so if you’re not picky about fuel, then use our map search to find a supermarket near you.
What about diesel?
Currently, no supermarkets are cutting the price of diesel, as the wholesale price of diesel hasn’t dropped, instead continuing to rise. If you’re a diesel driver, then you will unfortunately not benefit from the supermarket price war, but hopefully, there will eventually be some slight relief.
If you are a diesel driver, here’s a couple of tips to make your tank last a bit longer:
Keep your engine revolutions low by changing up gears early. You’ll lose speed fast if you let the engine labour. Try to keep the engine speed in the ideal fuel-efficient spot.
Don’t use your air conditioning unless you must. It uses the power of the engine which increases fuel consumption.
Ensure that your car is operating at peak performance. A 10% drop in tyre pressure can affect the efficiency of the tyre and rolling-resistance, leading to a decrease in MPG. Equally, a dirty air filter can have a dramatic effect on fuel usage – some experts claim that replacing a dirty air filter could improve your mileage by as much as 10%.
Are you glad that the prices are dropping? Will this help you out? Let us know below