Tesco, Asda, Morrisons, Sainsbury's announce petrol prices cut

It follows the Chancellor’s decision to cut fuel duty, announced on Wednesday in the spring statement.

Morrisons said it would lower prices by five pence per litre and Tesco is also taking off six pence.

Other retailers are facing pressure to lower their prices.

In his spring statement, Chancellor Rishi Sunak pledged to cut fuel duty on petrol and diesel by 5p per litre from 6pm on Wednesday for the next year after weeks of record highs at the pumps.

Prior to Wednesday’s announcement, fuel duty was at 57.95p per litre for petrol and diesel, with 20 per cent VAT charged on top.

The Treasury said the fuel duty reduction would save motorists around £2.4billion in the next 12 months.

Asda was the first supermarket to announce it would lower prices, with Sainsbury’s, Morrisons and BP following shortly after.

In a statement, Asda promised to pass the fuel duty saving on to customers.

The 6p drop includes a 1p reduction in VAT.

“The new prices will be implemented from this evening,” the company said.

“This means that motorists will see unleaded move back below 160p per litre and diesel to 170p.”

Sainsbury’s also said it “will be passing on the price reduction to customers – cutting the price of a litre by 6p which includes a 1p reduction in VAT.”

It added that the price reduction would come into effect at all Sainsbury’s forecourts this evening.

The company’s CEO Simon Roberts said: “Sainsbury’s will continue to sell through stock it purchased while the higher fuel duty was in effect but is lowering the price for customers from tonight, so that they can benefit from the Chancellor’s announcement sooner.”

Morrisons said: “Following the Chancellor’s announcement regarding the 5p duty reduction on fuel, prices at Morrisons Petrol Station pumps will reduce by 5 pence at 6pm this evening.”

BP said the 6 pence saving “will be passed on at the sites we operate in line with the Chancellor’s announcement”.

Figures from data firm Experian Catalist show the average cost of a litre of petrol at UK forecourts on Tuesday was 167.3p, while diesel was 179.7p.

This is an increase of 18.0p per litre for petrol and 27.0p for diesel over the past month.

Announcing the duty cut in his spring statement, Mr Sunak said the UK Government wanted people to know they will "stand by them" in dealing with rising living costs.

He told MPs: "Today I can announce that for only the second time in 20 years, fuel duty will be cut.

"Not by one, not even by two, but by 5p per litre. The biggest cut to all fuel duty rates - ever.

"While some have called for the cut to last until August, I have decided it will be in place until March next year - a full 12 months.

"Together with the freeze, it's a tax cut this year for hard-working families and businesses worth over £5 billion, and it will take effect from 6pm tonight."

Fuel duty has been frozen at 57.95p per litre for petrol and diesel since March 2011.

RAC head of policy Nicholas Lyes described the cut as "a drop in the ocean" as it will "only take prices back to where they were just over a week ago".

He said: "There's also a very real risk retailers could just absorb some or all of the duty cut themselves by not lowering their prices.

"If this proves to be the case it will be dire for drivers."

AA president Edmund King welcomed the cut but expressed concern that "the benefit will be lost unless retailers pass it on".

He also called for prices to be lowered due to the "substantial reduction in wholesale road fuel costs" since March 9.

"The road fuel trade shouldn't leave the Treasury to do the heavy lifting when cutting motoring costs," he added.

Paul Tuohy, chief executive at pressure group Campaign for Better Transport, said the cut will "do little to help those on the lowest incomes, who may not even own a car".

He went on: "Rail fares have risen at a higher rate than fuel costs, and bus fares have risen twice as fast, yet public transport passengers have not been given any help with the cost-of-living crisis."