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Diesel Fuel is Cheaper than Petrol for the First Time in 15 Years

Supermarkets have cut the price of diesel, making the fuel cheaper than petrol for the first time since the millennium.

Three of the biggest retail giants - Tesco, Morrisons and Asda - have dropped the price of diesel by up to two pence per litre. This comes just days after the AA commented that fuel retailers had been "plundering ordinary diesel car drivers" for the past 3 months.

At the end of last week, the average price of diesel was 118.21p compared to 116.75p for unleaded, according to

Andy Peake, Asda's senior director for petrol, commented: "Asda cutting another 2ppl on diesel is great news for our drivers, meaning they will pay no more than 112.7ppl at any Asda forecourt."

Meanwhile Mark Todd, petrol director for Morrisons, said: "Because of the recent price drops in the wholesale diesel price, we are able to pass on these savings to our customers. This is a milestone in motoring and many younger drivers won't remember the last time that diesel prices were lower than unleaded"

The RAC however feels that this move, while welcome, is also late. Steve Gooding, director of the RAC Foundation, said: "This is good news for the ten million or so diesel car drivers, but our analysis shows it could have come weeks ago. The wholesale price of diesel fell below that of petrol back in the middle of May."

The fall in prices comes as Saudi Arabia opens up new oil refinery plants. The wholesale price of diesel was 1p to 3p lower than petrol through the month, yet the average price of a litre of diesel at the pump is 120p, compared to 117p for petrol.

“A fundamental change in the fuel market is taking place as a result of Saudi Arabia opening two new refineries last year geared to the production of refined oil products, including diesel, "said RAC fuel spokesman Simon Williams.

“Saudi Arabia had previously concentrated on exporting crude, leaving refining to other countries, but greater European demand for diesel has led the kingdom to increase its refining capacity to create a profitable additional source of income"

By Tracey McBain