The short version
- Regulators found evidence of passive pricing strategies that kept profit margins elevated even as wholesale diesel costs declined in early summer.
- Over one thousand warning letters were issued to retailers failing to register with the mandatory Fuel Finder price comparison scheme.
- A comprehensive review of the road fuel market is scheduled for autumn to assess fairness and competition across the UK.
The United Kingdom’s primary competition regulator has raised significant concerns regarding the pricing behaviors of petrol station operators, suggesting that many are failing to pass on wholesale cost reductions to consumers quickly enough. The Competition and Markets Authority (CMA) highlighted what it termed 'passive pricing strategies' employed by a majority of retailers. These tactics appear to be sustaining elevated profit margins for businesses while drivers continue to face substantial financial pressure due to broader economic instability linked to the ongoing conflict in Iran.
Specific data from the watchdog’s latest quarterly update indicates that between May and June, several retailers did not immediately lower pump prices despite a drop in wholesale diesel costs. The CMA noted that such delays could have otherwise stimulated greater competition within the fuel market. Although overall costs at fuel pumps decreased slightly in June, prices remained markedly higher than pre-conflict levels. Furthermore, retailer profit margins were found to be at or above the historically high levels recorded throughout 2025.
Despite these concerns regarding pricing speed and margin retention, the CMA explicitly stated that it has not found evidence of profiteering directly attributable to the war in Iran. The distinction is crucial for regulatory action, as the watchdog differentiates between slow market adjustments and active exploitation of geopolitical crises. Nevertheless, the agency emphasized that its monitoring role is vital for ensuring drivers have confidence that retailers are not taking undue advantage of the Middle East conflict.
In parallel with its pricing analysis, the CMA has intensified enforcement efforts regarding transparency. Since April, the regulator has sent 1,166 warning letters and issued 53 compliance notices to retailers who failed to register their prices with the government-run Fuel Finder service. This price comparison scheme was established following a CMA recommendation in July 2023, which identified weakened competition among retailers since 2019. At that time, the watchdog estimated that drivers paid nearly £1 billion more for fuel at supermarkets due to inflated margins.
Currently, approximately 97% of petrol stations are registered with the Fuel Finder scheme, covering about 99% of all fuel sold in the UK. The CMA reported that it has not yet needed to issue fines for non-compliance, suggesting that the warning letters have been effective in driving registration. The scheme is operated by the government in partnership with technology company VE3, aiming to provide consumers with real-time price data to encourage competitive behavior among retailers.
Sarah Cardell, chief executive of the CMA, underscored the importance of these monitoring efforts in protecting consumer interests. She stated that the agency expects any reductions in wholesale prices to be rapidly and fully passed on to drivers. The regulator plans to continue closely watching prices and margins to ensure market fairness. In the interim, the CMA encourages drivers to utilize the Fuel Finder tool to identify lower prices when refueling.
Consumer advocacy groups have responded to the CMA’s findings with mixed reactions. Edmund King, president of the AA, criticized the slow response from many retailers, particularly large supermarket chains, while praising those that promptly adjusted their prices. He described the Fuel Finder system as a necessary step in helping drivers combat stubbornly high fuel costs. Similarly, Simon Williams, head of policy at the RAC, expressed concern over the lack of competition and historically high margins.
The RAC has urged the CMA to expand its scrutiny by comparing fuel retailing practices in Northern Ireland with the rest of the UK. Current data shows that petrol and diesel are sold for an average of 8p less per litre in Northern Ireland, resulting in a cost difference of approximately £4.40 for filling a family car compared to other regions. This disparity suggests potential inefficiencies or unfair treatment of drivers elsewhere in the country.
Looking ahead, the CMA has announced that it will conduct a more detailed review of the road fuel market this autumn. This comprehensive assessment aims to ensure that customers are paying fair prices for fuel across all regions of the UK. The upcoming review will likely examine retailer pricing strategies in greater depth and evaluate whether wholesale price changes are being reflected at pumps with sufficient speed and accuracy.
The situation highlights the ongoing tension between market forces and regulatory oversight in essential goods sectors. While no direct profiteering has been proven, the persistence of high margins and slow price adjustments continues to draw criticism from both regulators and consumer groups. The outcome of the autumn review may determine whether further structural interventions are required to restore competitive dynamics in the UK fuel market.
Sources behind this briefing
Go to the original reporting
- The Guardian World↗UK retailers too slow to pass on fuel price falls, watchdog says
