Motorists are getting some new-year cheer, with supermarket Asda lowering its fuel prices and rivals expected to follow suit later.
From today, Asda will be cutting the price of petrol and diesel by up to 2p a litre at its 229 forecourts. The company said the new prices would mean motorists paying no more than 126.7p a litre for petrol and 133.7p a litre for diesel.
Asda’s petrol trading director, Andy Peake, said: “With the latest price cut we’re now seeing the lowest price on diesel since July 2012.
“We’ve quickly passed on the latest reductions in costs which is great news for motorists, particularly with household budgets so stretched after Christmas”.
Usually one supermarket’s price cut is followed by its main competitors cutting their prices. For example, will Morrisons follow Asda and cut petrol on the group’s 320 UK forecourts? A spokesman for the Bradford-based company merely said: “We’ll remain competitive in every area we trade.”
Tesco has already announced its plans. A Tesco spokesman said: “Tesco is dropping the price of petrol and diesel by up to 2p per litre from tomorrow morning. As Britain’s biggest fuel retailer, this means more motorists can make savings and earn Clubcard points at Tesco’s 498 Petrol Filling Stations than at any other fuel retailer.”
Sainsbury’s had yet to comment at the time of going to press.
Automobile Association president Edmund King said: “Fuel price reductions at the pumps will bring a sigh of relief to many drivers who are struggling to make ends meet after bigger than normal financial outgoings during the festive period.
“We hope that other supermarkets and fuel retailers follow this lead to cut their prices at the pumps otherwise we just end up with a fuel-price lottery based on proximity to certain supermarkets.”
Steve Biddle, director of the northern region of the Road Haulage Association, looks after about 2,000 trucking members in the north.
He said: “Over the last month or two, the price of fuel has been competitive. I suppose it’s good news in that we are not seeing the huge increases we have seen in the past.
“The price of fuel had been stable for the last year to 18 months. Proposed fuel duty increases totalling 15p had been cancelled by the Government, which had helped.”
One man who remains defiantly indifferent to supermarket petrol prices is former head teacher and Bradford Labour councillor Keith Thomson, the T&A’s environment correspondent.
He said: “Reducing petrol costs by a couple of pence is neither here nor there. They cut prices because they want more people to go to their store. Often petrol is a loss-leader. It’s a way of attracting people to go there, park up and buy baked beans and things.”
Mr Thomson is not exactly anti-car. For 25 years he drove a 2CV, but had to give up driving for health reasons. He would prefer everyone to drive a small cost-effective, energy-efficient vehicle, or failing that, be like the citizens of Curitaba in Southern Brazil.
In this port city, 70 per cent of daily commuters are said to use the city’s 1,100 buses which make 12,500 trips a day. Mind you, the buses are described as comfortable, rapid – they turn up every couple of minutes – and cheap.
But Curitaba is not exactly anti-car either. The city is home to car makers Nissan, Renault, Volkswagen and petroleum conglomerate ExxonMobil.
The price of petrol fluctuates according to the production and cost of crude oil, we’re told. The actual cost, of course, depends upon the add-ons.
The price of a litre of diesel, for example, comprises the cost of the refined fuel: 48.82p plus VAT of 23.05p, fuel duty of 57.95p and 8.4p for other costs. Total cost at the pump: 138.30p.
But cost also depends on where you buy it. The price of petrol on motorways can be eight or nine pence a litre higher than at your friendly neighbourhood supermarket forecourt.
In this case, as in so many others, shopping around locally may be the cheaper choice to make.
The bigger implications for the economy at large – the cost to energy supplies and the charges they impose on people – remain to be seen. Inflation may have fallen, but few people appear to be going out to celebrate a wage or salary increase.
In the circumstances, every little helps – to coin a phrase.
A Sainsbury’s spokesman said: “We review prices at all our sites every day to ensure our fuel remains competitive. We know that fuel is an important part of any household budget.”
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