Coronavirus: Petrol could drop to 96p-per-litre

Published 11 May 2020

The cost of refuelling a car has dropped to its lowest level since May 2016 following plummeting oil prices, with further potential price cuts on the horizon.

The average price of a litre of petrol fell by 4.15p in April, from 113.1ppl to 108.95ppl, meaning the cost of filling a 50-litre hatchback (like a Volkswagen Golf) car fell from £56.55 to just £54.48. The historic fall in prices was a result of oil refineries running out of places to store oil as demand dried up amid the coronavirus outbreak.

The average price of a litre of diesel fell nearly 3p from 117.5p-per-litre to 114.54p in April - according to the RAC.

"Drivers could be in line for even cheaper fill-ups in the coming months [...] but that remains a big ‘if’ because as soon as more of us start driving the price of oil could begin to increase."

However, while wholesale prices of oil plunged, some of the UK’s largest fuel retailers did not cut forecourt prices with so few people buying fuel in the first place. This was in sharp contrast to March which saw the supermarkets announce an unprecedented 12ppl cost cut on a single day. 

If there's a significant easing of the coronavirus lockdown restrictions, there remains scope for a further 12p to come off the prices of both petrol and diesel. If fully reflected at the pumps, this would see unleaded down to an average price of 96ppl and diesel down to 102ppl.

But retailers are only going to reduce prices again if they can be confident of selling fuel in large enough quantities.

RAC fuel spokesman Simon Williams said: "While it might seem odd that fuel price falls stalled last month despite wholesale prices coming down yet further, it is explained by the simple fact that UK fuel retailers will have been selling a fraction of what they would normally have sold in the last six weeks."

"Drivers could be in line for even cheaper fill-ups in the coming months if wholesale prices remain suppressed, but that remains a big ‘if’ because as soon as more of us start driving the price of oil could begin to increase."

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