Morrisons becomes first major retailer to cut petrol prices to below £1 a litre

Slash in cost driven by global collapse in oil prices due to coronavirus pandemic

Morrisons has become the first major retailer to slash its petrol prices to less than £1 per litre.

The supermarket has set its price to a maximum 99.7p at its UK forecourts, the first time it has been "sold nationally" for less than £1 in more than four years.

It has also cut its diesel price to no more than 104.7p per litre.

The price decrease has been driven by a collapse in oil demand due to the coronavirus pandemic, which has forced national economies across the globe to shut down.

Since January, the price of oil has more than halved, to now around £25 per barrel.

Morrisons' head of fuel Ashley Myers said: “This cut will help people who are travelling to work, those shopping for essentials, and those assisting the elderly and vulnerable.

“We want to play our full part in reducing the cost of living and feeding the nation at this difficult time.”

Government figures show the average cost per litre and petrol and diesel on 4 May was 107.6p and 114.9p respectively.

The price collapse means filling a 55-litre family car is around £7 cheaper than seven weeks ago.

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Brent crude oil was trading at around $64 (£51) per barrel at the beginning of the year but sunk to under $19 (£15.40) last month.

The price hovered around $31 (£25) per barrel on Monday morning.

The number of UK motorists taking advantage of cheaper fuel is limited because the government has restricted the reasons for people being allowed to leave their home, although Boris Johnson said on Sunday that people can now “drive to other destinations”.

Department for Transport figures released last week showed that road traffic was around 58 per cent lower than in early February.

RAC fuel spokesman Simon Williams said: “Although the lockdown is far from over, yesterday's speech from the prime minister was a signal to drivers that they can begin to make more trips by car again - so credit is due to Morrisons for taking the lead and selling petrol and diesel at what is a very fair price and one that is much more reflective of what the retailer is itself paying to buy the fuel in.

“Unfortunately though, there is a darker side to any large price cuts - they heap yet more pressure on smaller independent fuel retailers, who in some cases are already fighting for survival as a result of the coronavirus outbreak.

“It remains to be seen how long prices this low will persist for, with some early indications that wholesale petrol prices have started to rise as a result of the world oil price creeping up.”

Additional reporting by PA