Fuel margins remain high despite lower fuel prices, CMA finds
Source: gov.uk (2025-06-29)

Today’s monitoring report sets out the Competition and Markets Authority’s (CMA) observations on developments in the UK’s road fuel retail market since the previous update in March 2025.

Dan Turnbull, Senior Director of Markets at the CMA, said:

While there is uncertainty over how global events will impact the price of oil, our report shows fuel margins remain high compared to historic levels despite lower prices at the pump in recent months.

The government committed to launching a ‘fuel finder’ scheme following our recommendation to help drivers compare real time prices and boost competition. Once launched, it will make it easier than ever to shop around and find the best deals.

Fuel prices

Fuel prices across the UK decreased for both petrol and diesel from end of February 2025 to end of May 2025. These movements reflect in part changing crude oil prices and refining spreads, both of which are driven by global factors.

The average petrol and diesel prices at the end of May 2025 were 132.0 and 138.4 pence per litre (ppl) respectively. This represents a decrease of 7.6 ppl and 8.4 ppl in petrol and diesel prices compared to the end of February 2025.

Fuel margins

A retailer’s fuel margin is the difference between what it pays for fuel and what it sells it at. The CMA found that fuel margins were similar to the high levels seen during its road fuel market study (https://www.gov.uk/cma-cases/road-fuel-market-study) – a review of the market to understand the factors influencing fuel prices undertaken in 2023 – which suggests overall competition in the UK’s road fuel retail market remains weak.

Supermarket fuel margins fell from 8.9% in December 2024 to 7.9% in February 2025, before rising to 8.3% in March 2025. Non-supermarket fuel margins fell from 9.9% in December 2024 to 8.9% in January 2025, before rising to 10.4% in March 2025.

This report does not consider developments in operating costs since the road fuel market study. The CMA will undertake a review of fuel retailer operating costs in its first annual road fuel monitoring report later this year to assess whether operating cost changes are impacting fuel margins for large retailers.

Retail spreads

The CMA also looked at the retail spread – the average price that drivers pay at the pump compared to the benchmarked price that retailers buy fuel at – across the UK from March 2025 to May 2025.

Petrol retail spreads averaged 15.4 ppl, which was 1.5 ppl higher than the previous 4 months period – and still more than double the average of 6.5 ppl over 2015-19. Diesel retail spreads averaged 18.8 ppl, which was 4.6 ppl higher than the previous 4 months period and more than double the average of 8.6 ppl in 2015 - 2019.

While spread analysis can give a quick overview of trends in the sector, it is a less reliable indicator of competitive intensity than individual retailers’ fuel margins. Retail spreads increase and decrease in response to the volatility of wholesale prices but should return to a normal range over time, if the market is working well.

Road fuel market study

At the end of its road fuel market study, the CMA recommended a new monitoring function and fuel finder scheme (https://www.gov.uk/government/news/cma-sets-out-plan-to-help-drivers-get-more-competitive-fuel-prices) to government.

The CMA has taken on the new statutory monitoring function, which will provide ongoing scrutiny of prices to encourage effective competition between retailers and help keep prices low for drivers. This update is based on data provided to the CMA by fuel retailers using its new information gathering powers granted under the Digital Markets, Competition and Consumers Act.

The ‘fuel finder’ scheme will allow drivers to compare real-time fuel prices, via navigation apps, in-car devices and comparison websites. The government’s aim is to launch the scheme by the end of this year, subject to legislation and parliamentary time.

Further details about the CMA’s road fuel monitoring function, including previous reports and guidance, can be found on the collection page (https://www.gov.uk/government/collections/road-fuel-price-data-scheme).

Notes to editors

The CMA issued section 311 Information Notices to the following retailers: Applegreen PLC; Arthur Foodstores Limited, Asda Express Limited, and Asda Stores Limited (Asda); BP Oil UK Limited; Esso Petroleum Company Limited; Moto Hospitality Limited; Motor Fuel Group; Rontec Roadside Retail Limited; J Sainsbury PLC; Shell PLC; Tesco PLC; and Welcome Break Group Limited.

Motor Fuel Group announced the completed acquisition of Morrisons PFSs in the UK on 30 April 2024.

All enquiries from journalists should be directed to the CMA press office by email on xxx@xxx.xx (mailto:xxx@xxx.xx) or by phone on xx-xxxx-xxxx.