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Highlights
- RAC said UK drivers are losing about £5.5 million per day based on current fuel prices and called on supermarket and fuel retailers to cut their prices immediately
- RAC said that supermarkets were slow to pass on the lower wholesale rates to their customers.
UK’s motoring body, the RAC, said that drivers are losing about £5.5 million per day based on current fuel prices and therefore called on fuel retailers to reduce their prices at the pumps on an immediate basis.
Supermarkets and fuel retailers in the country were ripping off British motorists, according to a BBC report quoting RAC’s spokesman, Simon Williams.
Williams added that supermarkets made up 50 per cent of the fuel, however, they were slow to reduce wholesale fuel prices and pass it on to their buyers.
The group added that supermarkets which are also petroleum retailers such as Asda, Sainsbury’s and others, should have reduced prices instead of increasing them.
Fuel prices fell recently due to the emergence of the new covid variant Omicron. Last month, the wholesale price of petrol dropped to their lowest since September, declining by 10 pence per litre. Meanwhile, wholesale diesel prices dropped by 7 pence per litre.
However, unleaded petrol, which had a cost of 147.28 pence per litre last month, saw an average price increase of 3.1 pence. On the other hand, retailers added an average cost of 2.7 pence to diesel prices in November.
Let us take a closer look at 2 FTSE 100 index listed supermarket stocks which are major petrol retailers, and how they reacted to the development:
- J Sainsbury PLC (LON: SBRY)
Sainsbury is the second-largest supermarket group in the UK and a leading fuel retailer.
The company said its H1 2021 group revenue (which excluded VAT and was inclusive of fuel) rose by 5.3 per cent to £15,724 million on year on year basis.
It’s H1 2021 profit before tax stood at £541 million, reversing from a loss before tax of £137 million in the year before.
Image source: Refinitiv
Sainsbury’s shares were trading at GBX 278.30, down by 0.18 per cent on Friday at 09:10 AM BST, while the FTSE 100 index was at 7,136.00, up by 0.10 per cent.
The company’s market cap stood at £6,503.54 million, and its one-year return was at 32.25 per cent as of 3 December.
- Tesco PLC (LON: TSCO)
Tesco is a leading UK based multinational supermarket and fuel retailer.
The company’s H1 2021/22 revenue (excluding VAT and including fuel) increased by 5.9 per cent to £30.4 billion (on a statutory basis). Its H1 2020/21 revenue was at £28.7 billion.
Image source: Refinitiv
Tesco’s shares were trading at GBX 278.15, up by 0.11 per cent on Friday at 10:13 AM BST.
The company’s market cap stood at £21,350.63 million, and its one-year return was at 23.92 per cent as of 3 December.
