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Morrisons has announced a cut in gasoline prices to a maximum of 99.7p per liter at all its service stations starting today.
The supermarket giant is the first to lower the price of petrol below the £ 1 threshold since oil collapsed last month and the coronavirus pandemic hit Europe, marking the first time fuel has been ‘ sells nationwide ‘for less than £ 1 per liter since February 2016.
Diesel prices have also been cut, and drivers pay no more than 104.7 pence per liter at any of 337 Morrisons service stations across the country.
Finally £ 1 per liter for petrol: Morrisons has announced that it will reduce the price of its petrol to a maximum of 99.7p per liter at UK offices starting today
Government figures show that the average cost per liter and gasoline and diesel on May 4 was 107.6p and 114.9p respectively.
Ashley Myers, Morrisons Fuel Director, said: ‘This cut will help people who commute to work, those who buy the essentials and those who help the elderly and vulnerable.
“We want to play our role in reducing the cost of living and feeding the nation in this difficult time.”
Morrisons cutbacks mean filling a 55-liter family car with a gasoline engine is around £ 7 cheaper than it was when the nation first closed seven weeks ago and £ 10 less than at the beginning of the year .
The news comes when the Government announced that the first phase of reducing the coronavirus blockade would begin as of Wednesday, and that those who cannot work from home can travel to their workplaces.
Prime Minister Boris Johnson urged these workers to avoid public transportation if possible, and recommended that they drive, bike, or walk.
People will also be allowed to drive wherever they want to exercise with members of their own home starting on Wednesday, and visits to parks or beaches in England will get the green light.
Supermarket fuel retailers last reduced the price of gasoline to less than £ 1 per liter in February 2016
While the supermarket price cut will be welcomed by motorists, it came about six weeks after the UK’s first independent service station, a Murco service station on the A435 between Kings Heath and Maypole on the outskirts of Birmingham, reduced the price of lead-free to below £ 1-a-liter on March 26.
Experts say major retailers have not cut prices to a similar level in the past six weeks as part of an effort not to tempt drivers to use their vehicles.
“The AA understands that lower fuel sales and concerns that lower pump prices during the blockade could encourage people to go on nonessential trips put pressure on fuel retailers to keep up the cost of fuel. higher than normal gasoline and diesel, “says Luke Bosdet, the AA. fuel prices spokesperson “
“However, there was evidence that this did not always ring true, with questionable average pump prices increasing by 10p per liter and average fuel costs in predominantly rural areas significantly lower than in highly populated parts.”
Rival supermarket retailers are now expected to match the cuts as part of a fresh fuel price war as demand begins to rise.
UK drivers have seen gasoline below £ 1 per liter only once since the 2008/2009 financial crisis.
That happened in late 2015 and early 2016, when the UK average gasoline price fell as low as 101.80p per liter, but Asda, Morrisons and Sainsbury’s charged less than £ 1 as part of a price war for attract customers.
UK drivers have seen gasoline below £ 1 per liter in supermarkets only once since the 2008/2009 financial crisis, which was in late 2015 and early 2016, according to official data.
Average gasoline prices in the past four weeks show how the price gap between the cheapest (Northern Ireland) and the most expensive (South East) has fluctuated, with differences of up to 8p per liter last week.
RAC spokesman Simon Williams said: ‘Although the shutdown is far from over, the prime minister’s speech yesterday was a signal to drivers that they can start making more car trips again, so it is because of Morrisons. for taking the initiative and selling gasoline and diesel at a very fair price and that reflects much more what the retailer is paying to buy the fuel. ”
However, Williams cautioned that there is a “dark side” to big price cuts like these as they accumulate even more pressure on smaller independent fuel retailers, which in some cases are already struggling for survival as a result of the outbreak. of coronavirus.
With the volume of road traffic dropping around 60 percent and more during the shutdown, the lack of demand for gasoline and diesel has put many independent fuel retailers, especially smaller service stations in rural areas, at risk of closure.
Some 100 have already been closed and another 900 are at risk, according to the Gasoline Retailers Association.
The reduction in the cost of fuel has been driven by a collapse in oil prices due to lower demand as world economies closed due to the coronavirus crisis.
The price of US oil fell negative for the first time in history last month, with the cost of a barrel of crude delivered in May plummeting to $ 37 negative due to lack of storage availability.
Oil prices have plummeted in recent weeks due to oversupply and underconsumption due to the Covid-19 pandemic
The price of US crude delivered in May plummeted for the first time in history last month.
Oil prices plummeted were the result of a production dispute between Saudi Arabia and Russia and falling demand due to restrictions on movements and driving of people during the Covid-19 pandemic.
Saudi Arabia, which produces about 10 percent of world supplies, decided to cut prices and increase production after Russia initially refused to accept the planned cuts two months ago.
When Russia, the Saudis and other allies finally agreed to the biggest production cuts in history last week, oil rose again.
The price was around $ 31 a barrel on Monday morning.
Simon Williams warned that this could mean that the low price of gasoline in four years may not last as long as drivers expect.
“It remains to be seen for how long such low prices will persist, with some initial indications that wholesale gasoline prices have begun to rise as a result of rising world oil prices,” he warned.
The average fuel price in the UK is 108.74p per liter for gasoline and 114.26ppl for diesel, according to RAC Fuel Watch, about 10p-per-liter more than Morrisons is charging today.
Wholesale prices indicate that it will recover, which means that gasoline may not stay below £ 1 per liter for long.
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