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Town/country fuel price gap closes

Fri, 21 Feb 2014

THE PETROL PUMP postcode lottery, meaning rural drivers lose out to town motorists on price, appears to be coming to an end.

The gap between prices in country districts compared with urban areas has closed from around 5p a litre to as low as 2p, according to the AA.

This dip in rural prices has contributed to a general nationwide fall in the cost of petrol, which now averages 129.63p a litre compared with 130.46p in mid-January.

The lowest petrol price over the last four weeks was 129.30p a litre on February 2 - the lowest average figure since February 2011.

Diesel now costs an average of 137.02p a litre, compared with 138.24p in mid-January.

The AA said the strengthening of the pound against the dollar had accounted for much of the drop in pump prices.

Yorkshire and Humberside has the cheapest petrol - at an average of 129.2p a litre - with Northern Ireland the dearest at 130.0p.

The East Midlands has the cheapest diesel, at 137p a litre, while Scotland has the most expensive, at 137.6p.

AA president Edmund King said: "Across whole towns, for months if not years, drivers and businesses have been charged 4p to 6p a litre more for petrol compared to what retailers charged for the same fuel in neighbouring towns. It was called 'local price-matching' and it was supposed to be consumer-friendly.

"But without retailers prepared to challenge the inflated status quo, it was a curse and led to complaints from local politicians and a near-revolt in Newbury (in Berkshire).

"Drivers in those towns don't know whether to rejoice or get very angry that, would you believe it, supermarkets and other fuel markets can actually trade at 2p to 3p a litre above prices in cheaper areas. The change confirms the extent of the rip-off and what was, in effect, a fuel retailers' toll for motorists coming on to their forecourts.

"Competition authorities need to consider a trigger whereby, if the majority of supermarkets and other retailers in a small town charge the same price which is 4p or more higher than in a neighbouring town, that is flagged up to the official watchdog who then asks retailers why this is happening. It is time for pump prices in small rural and coastal towns to be put to 'reset'."

By Press Association reporters