Store Wars: Petrol Price Battle Posted on July 22nd
10:42pm UK, Tuesday July 22, 2008
Britain’s biggest supermarket chain has weighed in to the petrol price war by cutting 4p off a litre of fuel.
Tesco has followed rivals by announcing price cut
Tesco made the move after the three other members of the “big four” supermarket groups announced they were putting their forecourt prices down.
Asda was first to move, cutting the cost of unleaded and diesel by 3p a litre.
Its promise to sell unleaded petrol nationwide for 113.9p a litre and diesel for 128.9p a litre from Tuesday morning was followed by a swift reaction from rivals.
Morrisons cut the price of unleaded and diesel by 4p a litre at its 285 forecourts on Monday evening.
And Sainsbury’s said it would cut petrol by 5p a litre from Thursday for customers who spend £50 or more in stores.
Tesco had already announced the same customer scheme a few weeks ago - but also announced it would cut a further 4p from prices at the pumps.
Used in connection with its Clubcard offer, the deal allows customers to reduce their fuel bills by up to 10p a litre.
Both Asda and Morrisons said they were responding to the recent fall in the price of oil.
The price of a barrel of oil dropped from a peak of $147 to $130 recently.
Tesco’s commercial director, Richard Brasher, said: “We know customers are feeling the pinch, but we continue to work hard in store and on the forecourt to cut the cost of living.”
Asda trading director David Miles said: “We are seeing a more stable reduction in oil prices, allowing us to pass on the savings to customers.
“We urge other retailers to follow our lead at a time when customers need as much help as possible.”
Morrisons group store operations director Mark Gunter said: “The cost of crude oil and refined product has fallen in the last few days and we are ensuring our customers reap the benefit by passing on the saving quickly, for cheaper prices at the pumps.”
The supermarkets’ fight to undercut petrol deals was welcomed by AA president Edmund King.
He said: “Since mid-July, the wholesale gasoline price has fallen 6% and the AA expects fuel suppliers to pass on, not pocket, the saving for the good of UK families, hauliers and the economy.
“We will watch price movements like a hawk, and should fuel suppliers and retailers appear to be dragging their feet we will seek to expose this.”