Monday 27th February 2017
Still think you’re getting a bargain by filling up at supermarkets?

Many of us use supermarket petrol stations because we believe their petrol prices are much lower than dedicated fuel retailers, and often choose to fill up whilst doing the weekly shop. Whilst this may be convenient, you might not actually be saving as much money as you initially thought.

Rob Hull, The Mail Online, reports:

Savvy motorists who fill up at supermarket fuel stations are no longer guaranteed to pay less for their petrol or diesel.

According to new research, the petrol price gap between the big four supermarkets and dedicated fuel retailers has dropped below 3p for the first time in a year.

The AA said 'driver confidence in supermarkets as the bastions of cheapest pump prices has been rocked over the past month', finding that both petrol and diesel was cheaper on average at Jet fuel stations between mid-January and mid-February than at Sainsbury's forecourts.

The AA's latest Fuel Price Report said the UK's average petrol price had climbed by 0.63p to 120.11p per litre over the space of a month, while diesel had increased 0.34p to 122.32p over the same period.

It's a stark contrast to the fees being paid at the pump by motorists a year ago - petrol was 18.16p cheaper per litre while diesel was 21.30p less expensive in mid-February 2016.

The spike in at-the-pump costs means the average family-size petrol car costs £9.99 more to fill up than it did last February, while a van of Transit size is £17.04 more expensive to refuel.

The increasing cost to top-up is having an impact on how much people are driving, according to industry insiders, with one forecourt owners claiming that trading fell 'off a cliff' in the final week of January.

The AA said supermarkets are now looking to trim the savings drivers can make by filling up vehicles at their fuel stations.

A major factor at play here may be that supermarkets have been doing better in their own trading and do not feel the same urgency as they did a year ago to use cheap petrol to pull in potential customers, who then do grocery shopping while on site.

For 12 consecutive months, petrol and diesel has been more than 3p-a-litre cheaper on average at ASDA, Morrisons, Tesco and Sainsbury's than it was at fuel suppliers like BP, Essso and Shell.

However, that difference has dropped to 2.9p in the last month.

With supermarkets trying to bridge the gap, some retailers have jumped at the opportunity to attempt to undercut their grocery-giant rivals.

In fact, both petrol and diesel have been cheaper on average over in the last four weeks at Jet fuel stations than it was at Sainsbury's - the second largest of the 'Big Four' supermarkets by market share.

The average price of petrol and diesel at Jet last month was 119.56p and 121.55p per litre respectively - that compares to 120.07p and 122.10p at Sainsbury's forecourts.

AA president Edmund King said the changing approach by supermarkets makes it more important for motorists to be aware of who is charging what for fuel to ensure they're getting the best deal.

'We accept that it is the prerogative of any retailer to charge what they like for fuel and, in the past, we have seen supermarkets switch to fighting their price wars in the aisles rather than on the forecourts,' he said.

'However, this latest change of tactic comes after nearly 15 months of tight fuel-price competition among supermarkets.'

Mr King suggested fuel apps and live fuel price sites, such as the AA app and PetrolPrices.com, could help drivers save money by identifying suppliers who are offering petrol and diesel at cheaper prices than their go-to provider.

'Drivers need to keep their ears and eyes open to locate lower pump prices,' he added.

'That may be a case of buying fuel in a neighbouring town with more competitive prices.

'Along the A3, from Portsmouth towards London, supermarket petrol varies by as much as 8p a litre – a difference we used to associate with the gap between motorway and non-motorway prices.'

Fuel retailers such as Jet Fuel has been fighting to drop prices down lower than popular supermarkets in a bid to stay ahead of the competition and win business. Either way, it’s worth noting that driving out of your way to fill up ‘cheaply’ from a popular supermarket might not be worth the journey, especially if a fuel retailer is only just around the corner.

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