Major retailers are failing to reduce petrol prices in line with falling wholesale costs, the RAC has warned.

The roadside recovery firm said the wholesale cost of unleaded – the price when it arrives at forecourts – is now back down to its early May price of 131.75p per litre, which saw average pump prices of around 167p per litre.

But drivers are currently paying an average of 183p per litre at pumps across the UK despite the drop in wholesale costs, the RAC said.

It comes after fuel prices hit their highest-ever levels earlier this summer as the UK’s cost-of-living crisis began to bite.

The wholesale cost of petrol has fallen by 20p since early June, according to the RAC.

Yet UK retailers continued to increase their prices in June and only dropped their pump prices by an average of 9p during July, the organisation said.

TRANSPORT Fuel(PA Graphics)

This means drivers filling up at the end of July average of 183p per litre could be paying almost £9 a tank more than they should be.

Equally, the RAC said drivers should now be paying about 182p per litre for diesel – nearly £6 a tank less than the end of July average of 192p per litre.

The “big four” supermarkets – Tesco, Asda, Morrisons and Sainsbury’s, along with several other suppliers – have faced criticism for failing to reduce their prices in line with falling wholesale costs.

The RAC said that, while several reduced their prices last week, the cuts are not enough to be in line with the wholesale cost.

RAC fuel spokesman Simon Williams said: “July has been an unnecessarily tough month for drivers due to the big four supermarkets’ unwillingness to cut their prices to a more reasonable level, reflecting the consistent and significant reductions in the wholesale cost of petrol and diesel.

“As it was, we saw independent retailers leading the charge, with fairer pump prices appearing all around the country, which eventually forced the supermarkets to finally implement a more substantial cut late last Friday afternoon.

“What ought to have happened is that the biggest retailers cut their prices more significantly on a daily basis, given the wholesale price of petrol has fallen steadily over the last eight weeks.”

Mr Williams advised drivers that they should no longer assume supermarkets are the cheapest places to get fuel.

He said motorists should “shop around as it’s highly likely you’ll find an independent retailer which is doing the right thing and fairly reflecting their lower wholesale costs by charging a lower price”.

He added: “This is really encouraging because the independents buy new stock less frequently than the supermarkets as they don’t sell as much, and consequently aren’t as well positioned as their rivals to be able to snap up fuel at lower prices when there are sudden market drops.”

AA president Edmund King also criticised major retailers for failing to drop prices, branding it “unforgivable”.

He said: “Average UK pump prices are down by around 9.5p a litre for petrol and 7p for diesel compared to early July. But, since early June, wholesale petrol is down 20p-25p a litre depending on whether or not you factor in VAT.

“In many areas of Britain, a 10p-a-litre drop in pump prices is still a ‘pumpdream’. And that is where the fuel trade is forcing struggling drivers to play the pump-price postcode lottery.

“When you consider that many small independents have been slashing 10p and sometimes 15p off fuel, because lower costs have allowed it, the failure of bigger forecourts to do likewise is pretty unforgiveable.”

Mr King added: “Drivers have been taken for an expensive ride during the cost-of-living crisis at a time they can least afford it.”

He said AA evidence given to the Competition and Markets Authority shows the fuel market is less competitive than the past, and called on the Government to deliver more fuel price transparency.

A spokesman for Sainsbury’s said: “We are committed to offering motorists great value, and over the weekend we lowered the price of petrol and diesel across our forecourts. We price locally and competitively.”

The PA news agency has contacted Tesco, Asda and Morrisons for comment.