The Competition and Markets Authority (CMA) is set to probe whether consumers are being subjected to higher grocery and fuel prices due to a potential lack of competition.
Although no specific evidence of competition issues in the grocery sector has been found thus far, the CMA believes it’s essential to confirm that poor competition isn’t contributing to the problem.
Simultaneously, the CMA provided an update on the Road Fuel market study initiated last year, suggesting that escalating pump prices cannot solely be ascribed to uncontrollable external factors. Instead, the market seems to display some deterioration of competition.
Analysis suggests that supermarkets’ fuel margins have particularly risen over the past four years, leading to average 2022 pump prices being approximately 5p per litre more costly than if the margins had stayed at 2019 rates.
Sarah Cardell, the CMA’s Chief Executive, expressed dissatisfaction with the level of evidence provided by supermarkets in their Road Fuel market study. As a result, the CMA plans to summon them for formal interviews to uncover the underlying issues.
The CMA aims to publish a comprehensive final report, inclusive of action recommendations, by early July. This move coincides with an inflation rate of 10.1%, which is over five times the Bank of England’s target, having remained in double digits since the previous August.
Year-on-year food prices escalated by 19.1% until March, marking the fastest growth in 45 years.
