Pump prices for drivers have remained relatively stable despite a significant drop in wholesale costs, according to the latest report from the AA. The motoring group highlighted that the wholesale price of petrol has decreased to levels last seen in 2021, prior to the conflict between Russia and Ukraine and subsequent price spikes. This decline in prices follows a reduction in oil prices to below $60 per barrel, the lowest since May, as a potential peace agreement between the two countries looms. The oil market is projected to face an oversupply next year.

While the cost that garages pay for petrol has been decreasing since the third week of November, dropping by over 7p per liter by the end of last week, drivers have not yet witnessed a significant impact on pump prices. The average nationwide pump price for petrol only saw a marginal decrease from 137.5p to 137.3p per liter during the same period. The AA estimated that if the full wholesale price reduction had been passed on, drivers could have saved approximately £4.60 when filling a standard 55-liter tank.

Diesel prices at the pump have also experienced minor reductions compared to wholesale costs. The average diesel pump price dropped by just a third of a penny, from 146.9p per liter at the beginning of December to 146.6p per liter by Monday.

These findings come as many motorists prepare for holiday travel during Christmas, potentially missing out on significant savings. The AA expressed concern over the delay in passing on price reductions to consumers but refrained from openly criticizing retailers. The organization’s spokesperson, Luke Bosdet, noted the frustration among drivers due to stagnant pump prices despite the opportunity for reductions.

The Competition and Markets Authority previously warned about the rise in fuel price margins by retailers, leading to accusations of overcharging motorists. The upcoming release of the CMA’s quarterly report on prices and margins is expected to shed further light on the industry’s practices. Gordon Balmer, executive director at the Petrol Retailers Association, emphasized that reductions in wholesale fuel prices are gradually being reflected in pump prices ahead of the holiday season.