Some petrol stations are still not passing on changes in wholesale prices quickly enough and more than a thousand warning letters have been sent to retailers failing to give prices to the Fuel Finder service, the UK competition watchdog revealed.
The Competition and Markets Authority (CMA) raised concerns in its latest quarterly update on the fuel market over “passive pricing strategies” used by the majority of retailers, which it said were helping to keep profit margins high amid soaring cost pressures on drivers from the Iran war.
It found some retailers did not immediately pass on falls in wholesale diesel prices to drivers between May and June, which could have boosted competition in the market.
The CMA said while costs overall fell at fuel pumps in June, prices remained significantly higher than before the Middle East conflict and retailer profit margins were either at or above the historically high levels seen in 2025.
But it did not find any evidence of profiteering among fuel retailers on the back of the war in Iran.
The CMA also revealed it had sent 1,166 letters to retailers and 53 compliance notices since April warning over a failure to register with the Government-run Fuel Finder price comparison scheme.
It said around 97% of petrol stations are now registered with the scheme, which account for about 99% of fuel sold in the UK, and it had not yet had to issue any fines.
The regulator will now “actively monitor” and carry out a more detailed review of the road fuel market in the autumn to ensure customers are paying a fair price for fuel across the UK.
Sarah Cardell, chief executive of the CMA, said: “We know prices at the pump are putting real pressure on drivers’ pockets and our monitoring plays an important role in giving drivers confidence that retailers are not taking advantage of the conflict in the Middle East.
“We will continue to monitor prices and margins closely and expect any reductions in wholesale prices to be rapidly and fully passed on to drivers.
“In the meantime, Fuel Finder can help drivers save money when they fill up.”
The AA said the CMA’s update “once again highlights some failures to not charge a fair price for petrol and diesel – at the expense of everyday drivers”.
Edmund King, the AA’s president, said: “Clearly, some fuel retailers are prepared to pass on lower costs promptly and help their customers.
“But many more, including large numbers of supermarkets, are not.”
He praised the Fuel Finder system as a “start in getting drivers to fight back against stubbornly high petrol and diesel prices”.
Fuel Finder was created on the back of a CMA recommendation in July 2023 after it found competition among retailers had weakened since 2019, with drivers paying nearly £1 billion more for fuel at supermarkets during the previous year because of increased margins.
The scheme is run by the Government and technology company VE3.
The AA said some forecourts were charging petrol at 10p a litre less than close rivals, while average prices are not reflecting falls seen at the end of last month.
Mr King said: “A 10p-a-litre crash in wholesale petrol in late July/early August has barely registered at the pump, with the UK average price trickling down a mere 0.4p a litre in seven days to the current 161.2p UK average.
“Wholesale petrol costs have rebounded since then but still remain 1p to 2p a litre lower than the peaks in mid to late July.”