Are High Gas Prices Here to Stay? A Deep Dive into Fuel Costs and the Coming ‘Fuel Finder’ Revolution
For months, drivers across the UK have felt the pinch at the pump. While prices have dipped slightly recently, a new analysis from the Competition and Markets Authority (CMA) suggests something deeper is at play than just global oil markets. The report reveals that fuel retailers’ margins remain stubbornly high, and operating costs aren’t the culprit. This raises a critical question: are we facing a new normal of elevated fuel prices, and what’s being done to address it?
The Margin Mystery: Why Are Prices So High?
The CMA’s investigation, covering data up to October 2025, found that fuel margins – the difference between what retailers pay for fuel and what they sell it for – are significantly above historical levels. Supermarket retailers currently average a margin of 9.6 pence per litre (ppl), while non-supermarket stations are even higher at 11.1 ppl. These figures, while slightly down from a peak of 10.9 ppl in 2022 for supermarkets, still represent a substantial increase compared to the 6.5 ppl and 8.6 ppl averages seen between 2015 and 2019.
What’s particularly concerning is that these margins aren’t being driven by increased operating costs. In fact, the report indicates that operating profit margins for large fuel retailers are increasing, suggesting they aren’t simply passing on costs to consumers. This points to a lack of robust competition within the sector.
Fuel Price Trends: A Recent Dip, But a Lingering Concern
Between November 2024 and October 2025, the average price of petrol fell to 135 ppl, an 8 ppl decrease year-on-year. Diesel saw a similar drop, averaging 142 ppl – also down 8 ppl. These declines are linked to fluctuations in crude oil prices, exchange rates, and refining spreads. However, the CMA’s analysis suggests these market forces don’t fully explain the persistent high margins.
Did you know? Retail spreads – the difference between the price drivers pay and what retailers buy fuel for – remain significantly above pre-2020 averages, even with recent price drops. Petrol spreads averaged 13.9 ppl, and diesel 14.6 ppl, compared to 6.5 ppl and 8.6 ppl respectively between 2015-2019.
The ‘Fuel Finder’ Scheme: A Game Changer for Motorists?
The CMA believes the key to unlocking fairer fuel prices lies in increased transparency and competition. That’s where the upcoming ‘fuel finder’ scheme comes in. Set to launch next year, this initiative will allow drivers to compare real-time fuel prices across different stations, using navigation apps and price comparison websites.
The idea is simple: empower consumers with information. By easily identifying the cheapest options, drivers can make informed choices and force retailers to compete on price. The government has accepted the CMA’s recommendations and is preparing to enforce data provision from fuel retailers to power the scheme.
Enforcement and Compliance: What Happens if Retailers Don’t Play Ball?
The CMA isn’t just launching the fuel finder; it’s also prepared to enforce compliance. New regulations require fuel retailers to provide accurate data for the scheme, and the CMA has the power to issue fines to those who don’t comply. However, the initial focus, at least until May 2026, will be on assisting businesses to understand and adhere to the new rules, rather than immediate punitive action.
Pro Tip: Keep an eye out for updates on the fuel finder scheme’s launch date and participating apps. Downloading a compatible app could save you significant money on fuel in the long run.
Beyond the Fuel Finder: Future Trends to Watch
The fuel finder is a crucial first step, but several other trends could shape the future of fuel prices:
- Electric Vehicle (EV) Adoption: As more drivers switch to EVs, demand for petrol and diesel will decrease, potentially putting downward pressure on prices. However, the pace of EV adoption remains a key factor.
- Geopolitical Instability: Global events, such as conflicts or supply chain disruptions, can significantly impact crude oil prices and, consequently, fuel prices.
- Government Policy: Future government policies, such as fuel taxes or subsidies, could also influence prices.
- Refining Capacity: Limited refining capacity can lead to higher wholesale fuel prices, even if crude oil prices remain stable.
FAQ: Your Fuel Price Questions Answered
- Why are fuel prices higher in some areas than others? Local competition, distance from refineries, and regional taxes can all contribute to price variations.
- Will the fuel finder scheme guarantee the lowest prices? The scheme will provide transparency, but prices can change rapidly. It’s still important to compare prices before filling up.
- What if a retailer refuses to provide data for the fuel finder? The CMA has the power to issue fines and take enforcement action.
- Is switching to an EV a guaranteed way to save money? EVs have lower running costs, but the initial purchase price is typically higher.
The CMA’s analysis paints a clear picture: the UK fuel market needs more competition. The fuel finder scheme represents a significant step towards empowering consumers and driving down prices. However, ongoing monitoring and enforcement will be crucial to ensure its success. The future of fuel prices remains uncertain, but with increased transparency and a focus on fair competition, drivers may finally see some relief at the pump.
Want to learn more about fuel efficiency and saving money on your journeys? Check out the government’s guide to eco-driving.
