The Competition and Markets Authority (CMA) has found no evidence that fuel retailers actively changed their pricing strategies to take advantage of the recent Middle East crisis, although it warned that concerns over competition in the UK road fuel market remain.
The CMA report, published today (18 August) assesses the impact of the conflict in the Middle East on fuel prices and margins until the end of June 2026 and provides an update on Fuel Finder activity.
It reveals that lower wholesale prices led to prices at the pump falling in June, although prices remained significantly above pre-conflict levels.
However, the CMA added that it “has not found evidence that retailers actively changed their pricing strategies to take advantage of the crisis”.
Nonetheless, the watchdog did not give the sector an entirely clean bill of health, noting that it remains concerned that the continued use of “passive pricing strategies” by the majority of retailers is contributing to sustained high margins.
A passive pricing strategy sets product or service prices based on a company’s internal goals, brand value, or unique advantages rather than actively reacting to or undercutting competitor prices.
The CMA found that some retailers did not immediately pass reductions in wholesale diesel prices on to drivers – a move which would have intensified competitive pressure on rival retailers.
Given these findings, the CMA said it will continue to actively monitor and undertake a more detailed review in the autumn.
The autumn report will include further analysis of retailers’ pricing strategies, whether wholesale price changes are reflected in retail prices in a timely manner and the reasons why fuel prices vary between local areas - with a view to ensuring that customers are paying a fair price for fuel wherever they live.
Sarah Cardell, CMA chief executive, 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.”
She also advised drivers to use Fuel Finder which aims to increase competition between fuel retailers by making it easier for drivers to compare fuel prices.
Around 97% of UK petrol stations are now registered with the scheme. Those those sites account for an estimated 99% of fuel sold in the UK.
To date, the CMA’s enforcement of Fuel Finder has focused on making sure retailers are registered with the scheme.
Since the end of the grace period in April, the CMA has sent 1,166 letters to retailers and issued compliance notices in respect of 53 sites.
Most registration issues are resolved quickly once retailers are contacted, the CMA said.
“This approach has contributed to extremely high levels of registration, with no need for the CMA to impose financial penalties,” it added.
The report also revealed that VE3, the aggregator responsible for reporting issues to the CMA, has not yet referred any suspected cases of non-compliance with the price reporting duty to the CMA.
The RAC has echoed the concerns of the CMA over passive pricing. Its research has led it to query whether retailers are passing on reductions in wholesale costs quickly enough, particularly for diesel.
RAC head of policy Simon Williams questioned why, when the wholesale price of diesel had been far lower than its peak for some time, it did not result in bigger forecourt reductions.
He added: “Petrol, however, could have risen further than it did, so it might have been the case that retailers decided to keep the price of unleaded down at the expense of greater diesel reductions.”
The watchdog’s findings have been welcomed by the Petrol Retailers Association (PRA), which said its members had fully cooperated with government requests and were participating in the Fuel Finder scheme.
PRA executive director Gordon Balmer said the findings showed retailers had not deliberately exploited the crisis to increase prices.
“I am pleased that the report found no evidence retailers actively changed their pricing strategies to take advantage of the crisis,” he said.
Balmer called for more government action to help drivers. He said: “Pump prices remain elevated primarily due to the crisis in the Middle East, and the government could play its part by reversing the cancellation of the fuel duty rebate due in the new year.
“Since the crisis began, it is estimated that the government is taking an incremental £90m per month in VAT due to higher pump prices.”
He added that higher petrol and diesel prices could generate around £1bn in additional VAT revenue for the Treasury over a year if current prices persisted.
