Cost of living: Small garages want petrol prices cut at chains

Independent garages are calling on big chains to slash petrol prices as the cost of living crisis continues.

RAC figures show unleaded dropped nearly 9p in July to 182.69p per litre, while diesel fell almost 7p to 192.38p.

Wrexham's Plas Acton Garage has dropped petrol below 167p, claiming it makes just pennies in profit on each litre.

Energy industry expert Carol Bell said drivers could expect petrol prices to fall as the effect of higher prices on global demand began to take hold.

Plas Acton's Marcus Ansloos said: "Unfortunately the bigger people in the industry haven't been bringing their prices down.

"With us doing this, it has forced everybody in north Wales to start looking at these prices and bringing them down.

"We are literally having a tanker delivering every day of the week to our forecourt and we are selling out on a daily basis, so it is sustainable."

Wholesale prices peaked at the start of June, but have fallen with oil costs while recession fears in the US and elsewhere have hit demand for oil.

The price of Brent crude - the international benchmark for oil - has slipped to about $100 a barrel, after soaring when Russia invaded Ukraine.

Abergavenny's Bailey's Garage said it had cut prices in line with falling fuel costs, dropping them to 167.9p a litre on Friday.

Ian Bailey said: "Because we're independent, we get the prices every morning. We work on a margin and we tap that in and that's what we sell it for."

Because chains buy in bulk, there is a time gap between the price of oil dropping and their selling off old stock.

Mr Bailey said: "The supermarkets are on a one-month lag, so when we were most expensive seven weeks ago, they had the old stock they could sell cheaper.

"But now since they've still got the old stock, they have to sell it dearer."

The RAC warned reductions at many pumps still did not fairly reflect the drop in fuel's wholesale price.

Dr Bell said: "When the price of diesel and petrol in a garage will change typically is when the garage owner receives a bulk delivery.

"So, there'll be a lag. If the tanks are fuller in the garage, then they will be charging a margin on what they've paid for it in the first place."

She added that it was a comparatively thin margin for garages of about 10%, once VAT, duty and costs of bringing fuel in were included.