Petrol prices dip below £1.50 per litre… but will they stay down?

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The average price of fuel in the UK has dropped to below £1.50, its lowest rate for almost a year.

Fuel prices rocketed to record high levels during the course of 2022, a rise stimulated by myriad factors in tandem with a sharp increase in home utility bills.

Peaking at £1.91 in June 2022, the cost of fuel in the UK would go on to average £1.66, smashing the previous marker of £1.36 recorded in 2012.

However, the start of a new year has brought some welcome news for road users with the price of fuel now averaging below £1.50 for the first time in almost a year, a drop of 9p compared with December 2022.

Though prices fluctuate on a daily basis, the latest slip it represents a general decrease in recent months, giving some respite to motorcyclists already grappling with the impact of energy prices during the cold winter months.


Why have fuel prices come down?

Numerous factors can play a part in the way fuel prices are dictated out on the forecourt.

Last year the sharp rises were blamed primarily on an increase in demand that disrupted the supply chain, which in turn pushed the wholesale price of oil up, while the unfolding instability from Ukraine’s war with Russia also played a significant factor.

With this in mind, these same reasons - albeit in reverse - have contributed to the gradual fall of prices, with supply recovering to meet demand, thus driving down the price of fuel.

Petrol retailers - including the supermarket chains - have also reacted to growing pressure from government and automotive bodies to act on cutting prices in light of their sizeable profit margins.


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Will fuel prices continue to fall?

However, motorcyclists are being warned that prices are likely to increase again on the horizon.

Indeed, while a reduction in the price of fuel has been welcomed by the Motorcycle Action Group (MAG), it points out that a sharp rise in tax duty at the end of March is just one of the factors bikers need to be wary of going forward.

“Fuel prices probably affect more leisure riders, in terms of their behaviour, whereas commuters just have to swallow it, so the effects of the price fluctuations will have different impacts depending on what you use your motorcycle for,” Colin Brown, Director of Campaigns and Political Engagement, exclusively told BikeSocial.

“It’s the usual case of prices going up very quickly but come down very slowly and I think this is one area that we have concerns over because the reduction doesn’t necessarily pass onto the customer straight away.

“Of course we have to remember that while prices might be coming down now, we are heading towards an increase in fuel duty at the end of the March which will be adding around 12p onto the price of fuel per litre.”


Where is the cheapest fuel in the UK?

The fluctuation in fuel prices mean there is no single retailer or forecourt that will offer the cheapest rate.

However, the ‘big four’ supermarkets - Tesco, Sainsbury’s, Asda and Morrisons - have continued to undercut their mainstream rivals - such as BP, Shell and Esso - while smaller chains like Murco and Q8 have also offered competitive prices at times.

At the moment, however, the lowest price recorded in the UK can be found at wholesale retailer Costco, which is offering a nationwide price of £1.37 per litre at the moment.

To find the cheapest fuel in your area, the PetrolPrices app (available on Android and Apple) provides prices from the main suppliers within a predetermined distance of your  location, and is free to download, though will need to create an account.