Three of Britain's biggest supermarkets cut price of petrol and diesel by 2p a litre

Asda, Sainsbury's and Morrisons drop cost of unleaded to 118.7p and diesel to 119.7p as RAC calls on more supermarkets to follow suit

The price of oil rose steadily in the second half of last year as Opec, the cartel of 12 producer countries including Iran and Saudi Arabia (Getty)

Asda, Sainsbury’s and Morrisons have all cut the price of a litre of petrol by up to 2p, responding to a slump in the price of crude in recent weeks.

Asda said on Friday that it had reduced the price of unleaded petrol to 118.7p. It said that it was cutting Diesel’s price to 119.7p per litre, also by 2p. Morrisons and Sainsbury’s, meanwhile,said that they were slashing their costs of petrol by up to the same amount.

The reductions have been enabled by a sharp drop in the price of oil over the past month, which will come as a relief for motorists after steady increases last year.

Earlier in the week, the RAC urged supermarkets to cut forecourt prices by 3p to reflect the decline in wholesale oil costs.

RAC spokesperson Simon Williams said on Friday: “Motorists will be pleased Asda has led the charge on reducing the price of fuel just a day after the RAC called for a cut. This should spark a chain reaction with the other supermarkets and fuel retailers across the country.

“After three months of petrol and diesel going up it’s a relief to see prices at the pumps finally coming down again just in time for half-term when more people will be taking to the roads.

“The falling price of oil has paved the way for these latest forecourt fuel cuts. This is due to the United States reaching record highs in crude oil production and a glut of fuel in storage when demand is lower, together with the North Sea’s largest oil pipeline coming back online after being closed for repairs since December.”

The price of oil rose steadily in the second half of last year as Opec, the cartel of 12 producer countries including Iran and Saudi Arabia, restricted supply.

Prices have now gone into reverse thanks to record US domestic crude production of 10.25 million barrels per day last week, according to the US Energy Information Administration. Iran also announced plans on Thursday to boost production.