Commodities● Neutral
CMA Warns Fuel Retailers Over Slow Diesel Price Cuts as Margins Stay High
The UK competition watchdog will review pricing strategies this autumn after finding some retailers slow to pass on lower wholesale diesel costs at the pump.
Continue with
Fuel retailers face a detailed Competition and Markets Authority review of pricing strategies this autumn after diesel pump prices failed to track lower wholesale costs in May and June, the watchdog said Monday.
CMA chief executive Sarah Cardell said the regulator expected wholesale price drops to be “rapidly and fully passed on to drivers” and would keep monitoring margins closely.
The CMA found some retailers were slow to cut diesel prices when wholesale costs fell between May and June. Pump prices dropped overall in June as wholesale costs eased, but remain significantly above levels before the conflict in the Middle East. The watchdog said it had found no evidence retailers actively changed pricing to exploit the crisis.
“Passive pricing strategies” are the bigger concern. The CMA said the widespread use of such strategies is contributing to persistently high margins. Some retailers failed to reflect lower wholesale diesel costs at the pump in a timely manner.