The Competition and Markets Authority has completed its first annual road fuel monitoring report under new statutory powers, assessing fuel prices, margins, and competition across the UK market.
The watchdog reports that fuel margins remain persistently high despite falling pump prices, concluding that operating costs do not explain current profitability levels, and setting this finding against the launch of new transparency measures for drivers.
CMA findings on fuel margins
The Competition and Markets Authority reports that fuel margins across the UK road fuel market remain above historic levels, even as average petrol and diesel prices have declined over the past year.
The analysis draws on data covering supermarket and non-supermarket fuel retailers up to September 2025.
The CMA states that this pattern suggests weak competition in the sector rather than cost-driven pricing pressures. The findings form part of the authority’s new monitoring role aimed at improving outcomes for consumers.
- Fuel margins remain above historic norms
- Weak competition identified as the primary factor
Average fuel margins by retailer type
| Supermarket retailers | Average margins declined from 10.9 pence per litre in 2022 to 9.6 pence per litre in 2025 year to date. |
| Non-supermarket retailers | Average margins increased to 11.1 pence per litre in 2025 year to date, up from 10.8 pence per litre in 2024. |
Fuel prices and recent movements
The CMA reports that fuel prices across the UK decreased for both petrol and diesel between November 2024 and October 2025. Average petrol prices fell to 135 pence per litre, while diesel averaged 142 pence per litre over the period.
The authority attributes these changes to movements in crude oil prices, exchange rates, and refining spreads. Despite these reductions, margins charged by retailers have not returned to pre-2019 levels.
Operating costs and retailer profitability
The CMA finds that operating costs do not account for elevated fuel margins, challenging claims made by some retailers. Analysis of data from 2020 to June 2025 shows operating profit margins for large fuel retailers increasing rather than flattening.
The authority states that if cost pressures were the main driver, profitability would be expected to fall or remain stable. Instead, the data indicates that margins have been maintained independently of cost movements.
- Operating profit margins have increased
- Cost pressures do not explain pricing behaviour
Retail spreads compared with historic averages
| Petrol retail spreads | Averaged 13.9 pence per litre, compared with a 2015–2019 average of 6.5 pence per litre. |
| Diesel retail spreads | Averaged 14.6 pence per litre, compared with a 2015–2019 average of 8.6 pence per litre. |
Fuel Finder scheme and regulatory oversight
The CMA confirms that the Fuel Finder scheme is scheduled to launch next year, requiring fuel retailers to provide real-time price data. The scheme is designed to allow drivers to compare prices through navigation apps and comparison platforms. The authority states that improved transparency is expected to increase competitive pressure between retailers. Alongside this, the CMA has published guidance outlining its enforcement role under the new regulations.
Stakeholder Comments
Dan Turnbull, Senior Director of Markets at the Competition and Markets Authority said;
“Fuel margins remain at persistently high levels and our analysis shows operating costs do not explain this. This indicates competition in the sector is weak, meaning drivers are not seeing the full benefit of lower wholesale prices at the pump.”
“Fuel costs remain a major concern for households, particularly during busy travel periods. The Fuel Finder scheme will give motorists clearer information and help drive stronger competition across the market.”
In Conclusion
The CMA’s latest report concludes that falling fuel prices have not translated into proportionate reductions in fuel margins for UK drivers. By identifying weak competition rather than operating costs as the underlying factor, the authority is signalling a sustained focus on transparency and oversight.
The forthcoming Fuel Finder scheme is positioned as a practical tool to support consumer choice and influence retailer behaviour as the new regulatory framework takes effect.
Sources: Competition and Markets Authority.
Prepared by Ivan Alexander Golden, Founder of THX News™, an independent news organisation delivering timely insights from global official sources. Combines AI-analysed research with human-edited accuracy and context.
