Nearly a billion pounds flowed from motorists' pockets into supermarket profits
In the quiet arithmetic of millions of ordinary journeys, British motorists were collectively relieved of nearly a billion pounds in 2022 — not through dramatic fraud, but through the gradual, coordinated withdrawal of competitive pricing by four major supermarkets. The Competition and Markets Authority has now named the mechanism and proposed its remedy: sunlight, in the form of legislation requiring real-time fuel price transparency accessible to any driver with a phone or sat-nav. The logic is ancient and simple — markets only discipline sellers when buyers can see clearly enough to choose.
- Four supermarkets quietly widened their fuel margins in lockstep after Asda and Morrisons passed into private equity hands, stripping the market of its two most aggressive price competitors.
- The invisible toll — sixpence per litre, fill-up after fill-up — accumulated into roughly £900 million extracted from motorists already battered by inflation across food, energy, and housing.
- The CMA has fined Asda £60,000 for withholding pricing data and is now pressing government to legislate mandatory real-time pump price publication across all fuel retailers.
- If the transparency regime passes into law, drivers could compare prices via apps and navigation systems, forcing retailers to compete openly rather than profit from consumer ignorance.
- Petrol is expected to fall below £1.40 per litre by month's end — a level not seen since October 2021 — as regulatory pressure begins to reshape market behaviour ahead of formal legislation.
For the first time in nearly two years, petrol prices may dip below £1.40 a litre by the end of July. The shift follows a significant finding by Britain's Competition and Markets Authority: that Asda, Morrisons, Tesco, and Sainsbury's had systematically raised their fuel margins in ways that cost motorists around £900 million across 2022 — an extra sixpence per litre, invisible to most drivers but devastating in aggregate.
The pattern took hold when Asda and Morrisons moved into private equity ownership and abandoned the aggressive, price-leading approach that had previously kept the wider market honest. Once those two stepped back, the others followed, each raising margins in tandem. The effect was a quiet market failure that persisted while households were already stretched thin by rising costs across the economy.
The CMA's response has been twofold. It fined Asda £60,000 for withholding timely pricing data, and it has proposed legislation requiring all fuel retailers to publish current pump prices in a standardised format — accessible through apps and navigation systems so that drivers can actually shop around. Chief executive Sarah Cardell was measured but direct: competition at the pump was not working as it should, and something needed to change swiftly.
The watchdog is now waiting on government to act. If the transparency regime passes, retailers would lose the shelter of opacity and prices would likely settle closer to where they should have been all along. The CMA is also investigating supermarket food pricing, suggesting the fuel overcharging may reflect a broader pattern of margin expansion during a period of acute economic stress.
For the first time in nearly two years, drivers pulling up to the pump could see petrol dip below £1.40 a litre by the end of July. Diesel is expected to settle around £1.49. The shift comes after Britain's competition regulator moved to dismantle what it found to be a coordinated system of overcharging that cost motorists roughly £900 million across 2022.
The Competition and Markets Authority concluded that Asda, Morrisons, Tesco, and Sainsbury's had systematically raised their fuel margins in ways that departed from how supermarket pricing had worked before. The practice began when Asda and Morrisons changed hands—both moving into private equity ownership—and both companies abandoned the aggressive, price-leading approach they had previously used to set the tone for the wider market. Once those two stepped back, the others followed suit, each raising margins in tandem. The effect was invisible to most drivers but devastating in aggregate: an extra sixpence per litre, month after month, across millions of fill-ups.
The CMA's response was twofold. It fined Asda £60,000 for withholding timely pricing data from the regulator. More significantly, it has proposed legislation that would require all fuel retailers to publish current pump prices in a standardized, accessible format—available through apps and satellite navigation systems so drivers could actually shop around. Right now, most people have no way to know if the station they're at is cheaper or more expensive than the one five miles down the road. The watchdog's logic is straightforward: transparency creates competition, and competition brings prices down.
Sarah Cardell, the CMA's chief executive, framed the problem plainly: drivers in 2022 paid roughly 6p per litre more than they would have in a properly functioning market. "Competition at the pump is not working as well as it should be," she said, "and something needs to change swiftly to address this." The language was measured, but the finding was damning—a market failure that persisted while households were already stretched thin by inflation across groceries, energy, and rent.
Analysts at AJ Bell noted the timing's particular cruelty. Consumers and small businesses were already reeling from rising prices across the economy when supermarkets chose to widen their fuel margins. Nearly a billion pounds flowed from motorists' accounts into supermarket balance sheets as a direct result of decisions made in 2022. The practice had roots in the ownership changes at Asda and Morrisons, both of which had previously used fuel pricing as a loss leader—a way to draw customers in and establish themselves as the cheapest option overall. Once private equity took control, that calculus shifted. Profitability on fuel became the goal, and the other three supermarkets simply matched the move.
The CMA is now waiting on the government to act on its recommendation. If legislation passes, the transparency regime could reshape how fuel pricing works across Britain. Drivers would gain the information they need to make choices. Retailers would lose the ability to hide behind opacity. Prices would likely fall toward what they should have been all along. The watchdog is also investigating supermarket food pricing practices, suggesting this fuel overcharging was not an isolated incident but part of a broader pattern of margin expansion during a period of economic stress.
Citações Notáveis
Competition at the pump is not working as well as it should be and something needs to change swiftly to address this.— Sarah Cardell, CMA chief executive
Drivers buying fuel at supermarkets in 2022 have paid around 6p per litre more than they would have done otherwise due to the four major supermarkets increasing their margins.— Sarah Cardell, CMA chief executive
A Conversa do Hearth Outra perspectiva sobre a história
Why did these four supermarkets all raise fuel margins at the same time? Was there a meeting, a conspiracy?
The CMA didn't find evidence of explicit collusion. What happened was structural. Asda and Morrisons changed ownership and shifted strategy—they stopped using fuel as a loss leader. The other two simply followed. It's not a phone call; it's a market signal.
But if they weren't coordinating, how is it overcharging? Isn't that just business?
The CMA's argument is that in a functioning market, one of them would have undercut the others to gain share. None did. That's the failure. Drivers had no way to compare prices, so retailers could all raise margins together without losing customers.
So the fix is just making prices visible?
That's the theory. If drivers can see that Station A is 3p cheaper than Station B, they'll go to Station A. Retailers then have to compete on price or lose volume. Transparency forces the market to work.
How much did an average driver lose?
Six pence per litre across the year. For someone filling a 50-litre tank weekly, that's roughly £15 a month, £180 a year. Multiply that across millions of drivers and you get to £900 million.
Will prices actually fall if this legislation passes?
The CMA believes they will, back toward October 2021 levels. But it depends on whether the government acts and whether retailers actually compete once prices are transparent. There's no guarantee—only the removal of an excuse to stay high.