>> 16 March 2010


SNP Gordon Westminster Candidate, Richard Thomson, has welcomed a recent equalising of fuel prices between supermarkets in Inverurie and Aberdeen, but has once more written to supermarket giants Tesco and Morrisons to explain what they describe as their ‘local’ pricing policies for petrol and diesel.

His intervention comes as the AA warned that prices could hit £1.20 per litre for unleaded petrol over the next few weeks – a price which is already being charged in Ellon for diesel - and called for the Chancellor to postpone a planned 3p rise in petrol duty due to come in on 1 April.

Mr Thomson earlier wrote to the Chief Executives of both Tesco and Morrisons supermarkets, following local complaints that fuel prices in both Ellon and Inverurie were regularly some 4-5 pence per litre more expensive than the same retailers were charging in Aberdeen.

Mr Thomson has now received written responses from both supermarkets, which defended their policy of charging different prices between stores in the North East.

In their replies, the supermarkets rejected Mr Thomson’s suggestions that they were in any way seeking to charge local motorists a premium price for their fuel, and placed heavy emphasis on the discounts which they offered for fuel when shoppers combined filling up their vehicles with their grocery shopping.

However, with the price of oil now above $80 per barrel and a corresponding rise in prices being seen at the pumps across Scotland, prices in Inverurie appear to have been held down, with Morrisons charging the same price per litre as their counterparts in the city, and Tesco a difference of 1p for petrol and 2p for diesel.

It’s a different story in Ellon, however, where Tesco petrol is 3p per litre more expensive than their store in the Bridge of Don, and diesel an astonishing seven pence per litre more expensive.

Mr Thomson said:

“I welcome the fact that Inverurie’s fuel prices appear to have converged, at least for now, with those in Aberdeen, and the fact that Morrisons is presently charging the same price as they are in Aberdeen is very welcome. However, the difference in price between Tesco in Ellon and their store in Bridge of Don when it comes to diesel is now simply ridiculous.

“If the price of oil goes up, you’d expect the price of fuel to go up everywhere. Instead, the prices at supermarkets in Aberdeen have risen, with those in Inverurie appearing to be held back – which makes the response of the supermarkets to my earlier enquiry into local prices all the more curious.

“I don’t believe for a minute that the retailers either are or have been selling fuel at a loss. Since their fuel comes from the same refinery – probably even from the same tanker - the only possible explanation for the convergence is that the supermarkets in Inverurie already had sufficient margin to absorb the recent price increases.

“While I’m sure local motorists will be relieved that the recent price increase doesn’t appear yet to have been passed on, the real test will be whether, if prices fall back once more in Aberdeen, local supermarkets will see their prices fall similarly.

“Supermarkets wouldn’t dream of charging different prices between stores for bread, milk or other essentials. I’ll be writing once more to the supermarkets, asking them to link local prices to those in the cities, and to seek a more detailed explanation as to how they operate their ‘local’ pricing policies.

“If the price differential is allowed to build up again, the suspicion will quickly return that local fuel prices are set not so much in line with wider market considerations, but by what supermarkets feel they can get away with.

“That would be a serious matter, and one which the Competition Commission might be persuaded to investigate further.

“We should never lose sight of the fact that nearly three quarters of the price of fuel is explained by tax levied on it by the Treasury. The SNP Westminster group will be introducing an amendment to the coming budget bill for the introduction of a fuel duty regulator to help mitigate the effects of oil price increases, and I challenge our local MP to support that measure when it comes before the House.”

NOTE: Petrol and diesel prices as at Monday evening (15 March 2010) were as follows:
  • Tesco Inverurie 114.9 petrol 114.9 diesel
  • Tesco Ellon 115.9 petrol 120.9 diesel
  • Tesco Bridge of Don 112.9 petrol 113.9 diesel
  • Morrisons Inverurie 112.9 petrol 113.9 diesel
  • Morrisons King Street 112.9 petrol 113.9 diesel

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