A Mystery at the Pump

You drive ten miles down the road and see the same brand’s forecourt sign; only the price is 8p cheaper. It’s enough to make anyone mutter. Petrol and diesel prices across the UK often vary dramatically between towns, even when they’re just a few postcodes apart. It’s not random, though. Those price swings come down to a mix of competition, transport costs, and local economics; a tangle of small factors that add up to real differences.

Let’s take a closer look at why you’re paying more (or less) depending on where you top up.

1. Competition and Local Pricing Strategy

This is the big one. Where there’s plenty of competition; think several supermarkets or rival garages within a short distance; prices tend to fall fast. In smaller towns with only one or two stations, there’s little incentive to discount fuel. Retailers know drivers have limited options and adjust prices accordingly.

Supermarkets play a major role here. When Tesco, Asda, or Sainsbury’s move into an area, independent stations often follow suit with price cuts to stay relevant. But in rural towns with no supermarket forecourt, prices can drift higher simply because they can.

2. Transport and Distribution Costs

Fuel doesn’t teleport to the pump. It’s shipped from refineries or storage terminals by tanker lorries; and those journeys cost money. If a town is far from a fuel terminal, or if it sits on routes with higher logistics costs, those expenses get passed on to the customer. Coastal and inland towns might see small differences just from how far the nearest depot is located.

In Scotland, Wales, and parts of rural England, transport costs alone can add several pence per litre compared to big city stations.

3. Local Demand and Buying Habits

Some towns simply sell more fuel than others. A busy commuter hub or an area with a high volume of delivery traffic goes through far more petrol and diesel than a quieter market town. That means larger, faster stock turnover; and stations can afford tighter margins. Low-volume sites, on the other hand, need to make more per litre to cover their running costs.

So, oddly enough, the busier your local roads, the better your chances of finding cheaper fuel.

4. Brand Positioning and Perceived Quality

Some brands charge more because they can. Premium fuels; marketed with names like “Ultimate”, “V-Power”, or “Momentum”; claim to improve performance and efficiency. Whether they’re worth it depends on your engine and driving style, but the extra few pence per litre mostly reflect brand strategy rather than raw cost. Independent garages and supermarkets rarely offer these “performance” fuels, so they compete more aggressively on standard unleaded and diesel prices.

In short, brand loyalty costs money. Sometimes literally.

5. Regional Taxes and Overheads

While the UK’s fuel duty is set nationally, local costs can still differ. Business rates, staff wages, and property rents vary widely across regions. A forecourt in central London faces higher costs than one in Northumberland; and those overheads feed straight into the pump price. Even electricity and card processing fees can tip the balance slightly in areas with fewer providers.

It’s not just the oil price driving things. The economics of each postcode play their part too.

6. Timing and Market Delays

Oil prices on global markets fluctuate daily, but not every garage changes prices at the same pace. Supermarkets often react within hours, updating digital signs overnight. Smaller independents may wait days or weeks before passing on changes; especially if they’re selling from older stock purchased at a different price. That’s why you’ll sometimes see big price jumps in one town while another seems untouched.

Think of it like a lag: it’s not that one town is gouging customers, just that each retailer moves on its own schedule.

7. Proximity to Motorways

Anyone who’s ever paid motorway prices knows the sting. Fuel at motorway services can cost 20p or more per litre above local rates. Why? Location and convenience. Operators know that drivers on long trips will pay for ease rather than hunt around unfamiliar towns. The same principle affects nearby towns too; stations close to motorway junctions often charge more simply because they can capture through-traffic.

Head a few miles away from the junction, and prices usually tumble.

8. The Supermarket Effect

Supermarkets dominate the UK fuel market, accounting for over 40% of sales. They treat fuel as a “footfall product”: attract customers with low prices, and they’ll spend inside the store. Towns with multiple supermarkets benefit from this quiet price war. Those without? Not so much.

Supermarket prices tend to act like an anchor; once they set the tone, other local stations fall roughly in line. Without them, independents can maintain higher margins without losing trade.

9. Seasonal and Local Events

Prices can also rise during local festivals, tourist seasons, or sudden surges in traffic. Coastal areas often see summer price spikes as visitors pour in. It’s simple supply and demand; stations know they’ll sell out either way, so they make hay while the sun shines. Likewise, rural routes leading to popular attractions can see brief weekend increases before prices settle again.

10. How to Find a Fair Price

You can’t control market forces, but you can stay one step ahead. A few minutes of research saves more than you’d think:

• Use PetrolPrices.com to compare local rates.
• Check MotorMouth or Confused.com’s fuel tracker for updates on your route.
• Fill up midweek; prices tend to dip slightly between Tuesday and Thursday.
• Avoid motorway forecourts whenever possible; plan a short detour for a cheaper stop.

With a little awareness, you can make the system work for you instead of against you.

Useful UK Resources

• RAC – Fuel Price Updates and Advice
• PetrolPrices – Local Fuel Comparison
• GOV.UK – Weekly Fuel Price Statistics