Has fuel bottomed out after falling 2p in June?

Filling up a car

The price of forecourt fuel fell by an average of 2p per litre in June, according to the RAC. The cuts came a 6% slump in the price of crude oil pushed the wholesale price of petrol down by more than 3p per litre.

The average price of a litre of unleaded was 114.71p at the end of June, down from 120p in February. Diesel fell to 115.57p per litre, down from 122p in February.  Drivers who choose to fill up with supermarket fuel are seeing even bigger savings, with average prices down to 111.73p for petrol and 112.32p for diesel.

Sharp-eyed drivers will have noticed that diesel has actually been slightly cheaper than petrol at times over the last month or two. That was because the wholesale price of diesel was lower than that of petrol for a time. According to RAC fuel spokesman Simon Williams, that’s not the case anymore. Williams says that “right now they are broadly the same”.

What’s next for fuel prices?

The oil market remains oversupplied with crude oil despite the efforts of OPEC to orchestrate production cuts. That’s why the oil price is down and petrol and diesel have stayed relatively cheap.

Many market observers thought that the price of oil would have started to recover by now. But many now expect that the current situation could persist for a while longer. The reality, however, is that future oil prices aren’t easy to predict. There are lots of factors which could influence market sentiment and the balance between supply and demand.

In the short term, the RAC’s analysts expect petrol and diesel prices to remain more or less flat. The RAC Fuelwatch website is indicating no change likely for petrol or diesel over the next couple of weeks. If you’re about to head off on holiday, that’s surely good news.

In the meantime, if you need to fill up, don’t forget to check for the cheapest fuel prices in your area on our Fuel Price page.

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