Why Petrol Prices Vary So Much Between Stations (And How to Save)

You have probably noticed it on a long drive. Two petrol stations less than a mile apart, same brand, same week, and one is selling unleaded at 132.9p while the other is at 147.9p. That is fifteen pence a litre, or six quid on a tank, for fuel that came out of the same refinery.

Petrol pricing is one of the most opaque parts of household spending in the UK. Most drivers assume the price is set nationally and barely varies. The reality is that pricing decisions are made forecourt by forecourt, change without warning, and depend on a lot more than the wholesale oil price. Here is how it actually works.

The four big things in your pump price

When you pay 145p a litre for unleaded, the breakdown looks roughly like this:

• Fuel duty: a flat 52.95p per litre. Same on every forecourt in the UK. Set by the Treasury and unchanged since the 5p cut in March 2022.
• VAT: 20% applied on top of everything else, including the duty. On a 145p litre that is about 24p going to HMRC.
• Wholesale fuel cost: roughly 50 to 60p, depending on the global oil price, the GBP / USD exchange rate, and refinery margins.
• Retailer margin and operating costs: the leftover, typically 7 to 12p a litre. This is what the station owner has to cover staff, electricity, card processing fees, the loan on the underground tanks, and finally any profit.

Two of those four numbers (duty and VAT) are identical at every forecourt in the country. The wholesale cost varies a little by region and contract, but two stations on the same trunk road will be paying within a penny of each other.

The 15p gap you sometimes see is therefore almost entirely retailer margin. Some operators choose to take 4p of profit and chase volume. Others know they have a captive audience and take 18p.

Why the same brand can charge wildly different prices

This is the bit that surprises most drivers. A Shell station near a motorway exit and a Shell station in a small town can charge prices that are 10p apart on the same day. Big oil companies set a recommended price for their branded sites, but most UK forecourts are operated under a franchise or dealer model. The franchisee decides the actual pump price, often based on:

• Local competition. If there is an Asda or a Costco within a couple of miles, even a Shell forecourt has to come down. If the nearest rival is fifteen minutes away, the price drifts up.
• Whether the site is a "destination" or a "convenience" stop. Motorway services are extreme convenience pricing. Out-of-town supermarket sites are extreme destination pricing.
• Forecourt traffic volume. A site filling 8 million litres a year can take a much smaller margin per litre than a site doing 2 million.
• Whether the operator owns the land. Sites on rented forecourts often need a fatter margin to cover the rent.

This is why two adjacent forecourts of the same brand can quote different prices. They are run by different businesses making different commercial choices.

Why supermarket fuel is almost always cheaper

Asda, Tesco, Sainsbury's and Morrisons sell roughly 45% of all petrol and diesel in the UK between them. They use fuel as what economists call a "loss leader". The point is not to make money on the petrol; the point is to get you to fill up and then walk into the shop to buy a £15 trolley of groceries with a 25% gross margin on it.

That dynamic lets the supermarkets price fuel at very thin margins (sometimes break-even) and still come out ahead. Independent forecourts cannot match that on a like-for-like basis because they have nothing to cross-sell except a packet of crisps and a coffee.

The Competition and Markets Authority concluded in its 2023 road fuel review that supermarket fuel margins had doubled between 2019 and 2022, and that the savings were no longer being passed on as aggressively as they used to be. So while supermarkets are still usually the cheapest option, the gap has narrowed.

Why prices can move twice in a week

Forecourt operators usually receive a wholesale price update from their supplier daily. Most retailers update their pump price weekly, on a Monday or Tuesday, but big chains can update mid-week if wholesale prices spike or drop sharply.

Two events tend to drive sudden swings:

• A geopolitical shock that moves the oil price. A pipeline attack, an OPEC announcement, or a sudden weakening of the pound can push wholesale costs up 5p in a day. Forecourts pass this on within a week.
• A supermarket price war. When one of the big four cuts prices to defend market share, the others usually follow within 48 hours. This is why you sometimes see four supermarkets in a town all drop 4p the same week.

Independent stations that sit between two supermarkets will reluctantly follow the move down. Independents in rural areas, where the nearest competitor is miles away, often do not.

How to actually find the cheapest fuel near you

Until 2024, there was no live, comprehensive UK fuel price feed. The only ways to find a cheap forecourt were word of mouth, driving past three of them, or paying for a third-party app that scraped data unreliably.

That changed when the government launched the Fuel Finder scheme. Under the new rules, large retailers (and any independent selling more than 1 million litres a year) have to publish their pump prices in a standardised format within 30 minutes of changing them. The data is free, public, and updated continuously.

Our free UK fuel price checker plugs straight into that data. Type in your postcode and see every participating station within a few miles, ranked cheapest first, with both petrol and diesel. The map view shows price gradient by colour, so the cheapest forecourts in your area are immediately obvious. Each station also has a price history page showing how its prices have moved over the past 90 days, so you can spot the consistently cheap operators.

A few practical tips for using fuel price data well:

• Do not drive an extra 5 miles to save 3p a litre. The fuel and time cost of the detour usually wipes out the saving on a single tank.
• Plan around stations on your existing route. If you commute past four forecourts, learn which is cheapest and time your fill-ups to land there.
• Watch for weekend price moves. Many independents cut prices on Friday or Saturday to compete with weekly supermarket shoppers.
• Don't run on fumes. Drivers who run their tank to empty often have to refuel at whatever forecourt is nearest, which is usually not the cheapest.

What about premium and additised fuels?

Most stations sell a "super unleaded" (E5, 99 RON or similar) at a premium of 10 to 15p a litre over standard unleaded (E10). Brand-name fuels like V-Power and Ultimate are typically priced even higher.

For most modern cars built since 2010, the manufacturer's own data shows no measurable improvement in fuel economy from premium fuels. There is an argument for occasionally running a premium tank through an older direct-injection engine to clean out injectors, but as a default fuel choice, the extra spend almost never pays back. If your handbook says E10 is fine, E10 is fine.

The exception is a small group of high-performance cars whose handbook explicitly requires 98+ octane. In those, run premium because the engine is tuned for it. Everyone else is paying for marketing.

How driving habits beat finding the cheapest pump

A 5p saving on a 50-litre tank is £2.50. Driving more efficiently saves more than that on a single trip:

• Smooth acceleration and braking. Aggressive driving can burn 30% more fuel than relaxed driving on the same route.
• Correct tyre pressure. Underinflated tyres add 1 to 3% to fuel use. Free to fix.
• Roof boxes and bike racks. Add about 10 to 20% to fuel use at motorway speeds. Take them off when not in use.
• Cruise control on flat motorways. Saves fuel because it avoids small accelerator twitches. Avoid on hilly routes where it overshoots.
• Air conditioning at low speed. Uses 5 to 10% more fuel. At motorway speed it is roughly equal to having the windows open, so use AC.

Combine driving habit changes with using a fuel price checker for the actual fill-up and most drivers can knock 8 to 12% off their annual fuel bill without changing the car.

The bottom line

Petrol and diesel pricing in the UK is far less standardised than most people assume. Two forecourts on the same road can be 15p apart, the gap is almost entirely retailer margin, and supermarkets stay cheap because they treat fuel as a customer-acquisition tool rather than a profit centre.

Use the live data to fill up at the cheapest pump on your normal route, drive smoothly, and keep your tyres pumped. That combination beats any fuel-saving gadget on the market.