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Diesel drivers are being ripped off at the fuel pumps as retailers keep prices artificially high, according to a leading motoring group.

Motorists are overpaying for the fuel by 16p per litre, according to the RAC, which says pump prices have yet again failed to fall in line with wholesale costs. Diesel is now cheaper than petrol on the wholesale market but filling stations are still charging an average of 13p more than for unleaded.

Diesel prices at the pumps fell again in April - the sixth consecutive month of reductions - but the RAC’s Simon Williams says the 4p per litre drop nowhere near reflects the recent reductions in what retailers are paying. The average price of a litre of diesel is now 159.43p per litre, but the RAC believes that a fair price would be closer to 143p.

According to the RAC’s figures, retailers are enjoying a massive 22p per litre profit on diesel, compared to the 8p on petrol, leading to fears diesel drivers are subsidising cheaper fuel for petrol drivers.

Why is diesel now cheaper than petrol?

Diesel has long been more expensive than petrol but the war in Ukraine and its effect on oil and diesel supplies saw the difference grow rapidly. Historically there has been around 4p per litre difference at the pumps but this reached a record 25p in early November 2022, shortly after the wholesale gap reached 30p per litre in late October.

Since then, the price of both fuels has fallen but recently diesel’s drop has been sharper and in March the wholesale price reached the same as petrol. In April it dropped another 9p, to 104.88p while petrol fell only 6p, to 111.25p. However, diesel remains 13p more expensive.

Williams commented: “This just isn’t fair for the country’s 12 million diesel car drivers. We feel there should be an obligation on retailers to reflect wholesale price movements on their forecourts. Sadly, the only place this seems to happen is in Northern Ireland where a litre of diesel is, incredibly, being sold for 12p less than the UK-wide average.

“Our data shows that the average retailer margin on a litre of diesel is a shocking 22p a litre compared to petrol which is around 8p. The long-term averages for both fuels is 7p which means retailers are making three times what they have in the past for diesel.

“We realise retailers need to make a profit but a margin of 22p on every litre of diesel can only be seen as a slap in the face to those who depend on it.”

Petrol and diesel continue to be cheaper in Northern Ireland than in mainland UK, partly due to a nationwide price monitoring system. Motoring bodies, including the RAC and AA recently welcomed reports that Chancellor Jeremy Hunt was examining a similar system for the rest of the UK.

Such a system could require retailers to submit weekly price information to allow for better transparency or could even involve real-time price tracking for individual filling stations - similar to systems in France and Germany.

UK fuel prices 2023: diesel prices ‘16p too high’ as petrol stations fail to pass on savings

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