Business Secretary Kwasi Quarteng wrote to leading petrol sellers to “remind them of their responsibilities” to reduce taxes on motorists.
A letter sent to the fuel giant on Tuesday said some retailers had increased profits after cutting fuel tariffs by 5 pensions per liter introduced Chancellor Rishi Sunak in March to help motorists in the background cost of living crisis.
The RAC said retailers were earning an average profit of 2 pensions per liter more than before the policy was introduced.
It also happens when diesel prices on Monday reached a new high of 179.9 retirees in the UK, according to the Department of Business, Energy and Industrial Strategy. That’s up from 178.4 a year earlier.
In his letter, Mr Quarteng said motorists were “rightly disappointed that the reduction in fuel duties, which the Chancellor apparently did not include in the court’s price in any visible or significant way”.
“It is also unacceptable that there are very different prices in different places, even in the same retail chain,” Mr Quarteng added.
“Therefore, the Chancellor and I want to emphasize once again and reiterate our expectations that members will do their best to ensure that drivers get fair deals across the country.”
The business secretary said officials in his department had recently contacted the Office of Competition and Markets on the issue as a result of “apparent intolerance to date”.
He said the regulator was “closely monitoring the situation”.
“I have been assured that they will not hesitate to use their powers to act against petrol stations if there is evidence that they are violating competition or consumer law,” he added.
Earlier, Downing Street again put pressure on fuel giants to pass on tax cuts to motorists.
A spokesman for Prime Minister Boris Johnson said: “The public rightly expects retailers and other members of the supply chain to bear the reduction in fuel duties on homesteads. This is the biggest reduction in all fuel rates and could mean big savings for families.
“We know that a number of retailers – major supermarkets, Asda, Tesco and Sainsbury’s – are moving to downsizing, and we will be raising this with other petrol retailers.
“The business secretary will write to the industry again to remind them of their responsibilities so that they do not doubt the need to make sure everyone is transmitting these cuts in the front yard.”
But Gordon Ballmer, executive director of the Association of Gasoline Retailers, which represents independent businesses, said comparing pump prices to wholesale prices “gives only a partial picture” because it doesn’t take into account “extra costs” including shipping costs.
“Five pence per liter is not a significant enough reduction to ease the burden of rising prices for motorists,” he said.
“While the chancellor was announcing this, oil prices rose and effectively reversed the decline.
“In addition to this, sales of petrol and diesel have not yet returned to pre-pandemic levels.
“Supermarkets and independent fuel retailers are vigorously competing with each other at the lowest margins.”