THE Office of Fair Trading (OFT) yesterday caved in to pressure from MPs and said it would investigate the UK petrol and diesel sector. The review will look at whether reductions in the crude oil price are being reflected in the price at the pumps and lack of competition in the sector.
MPs and consumer groups yesterday hailed the decision, with new transport minister Patrick McLoughlin understood to be supportive of the review, which follows continued pressure from MPs.
In July around 60 MPs demanded an investigation into why petrol retailers were reticent to pass on oil cost savings to consumers.
Conservative MP Robert Halfon, who has been campaigning for lower fuel prices, said yesterday: “Pump prices keep going up and up, even though there is no oil shortage. Why? We need a proper investigation, just as Germany and America are doing. Britain is being taken for a very expensive ride.”
The OFT said it would also look into whether supermarket practices, including when petrol is sold at a loss in order to attract shoppers into stores, make it hard for independent retailers to compete.
The UK’s retail roads fuel sector is worth around £32bn a year. Petrol prices rose by 38 per cent between June 2007 and June 2012, while diesel prices rose 43 per cent. According to Bloomberg’s Gas Price Ranking, the UK is the 10th most expensive region in the world for fuel.
The OFT will gather information over the next six weeks, and will publish its findings in January 2013, the month when the postponed 3p petrol tax rise is due to take effect.