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Supermarket cuts cost of petrol Supermarkets move to cut petrol
(about 16 hours later)
Supermarket chain Asda says it is cutting the price of petrol and diesel at its forecourts. Supermarket chain Tesco has followed Asda after saying it would cut petrol and diesel prices at its forecourts.
With oil costs dropping sharply in the last two days, Asda has cut 1.5p a litre off diesel prices, to 89.9p. Tesco said it would cut up to 2p per litre on diesel after Asda announced a cut of 1.5p a litre to 89.9p.
The supermarket is also making a more modest cut on unleaded petrol, dropping 0.2p to a price cap of 85.9p a litre. Both firms will also cut prices of unleaded petrol - Tesco's planned cut is 1p per litre and in Asda's case a modest 0.2p to a price cap of 85.9p.
Oil prices have fallen on both sides of the Atlantic due to a mild winter helping to reduce demand for heating oil and other products. The move follows falling oil prices on both sides of the Atlantic after a mild winter reduced demand for heating oil.
A spokesperson for Tesco said: "We've seen further reductions in wholesale costs so we'll be dropping prices to pass on the benefits to our customers."
Heating oilHeating oil
Oil reached a peak of $78 for a barrel of US light crude in July, driven by the conflict in Lebanon and ongoing high demand spurred by China.
Opec has said it will take action if prices continue dropping.
Asda, which has 167 petrol stations, said its diesel is now at its cheapest for more than a year. Prices for diesel are normally higher during January because of its use in heating.
Andy Brem, from Asda, said: "The unseasonably mild weather so far this winter has reduced heating oil consumption across Europe and the US.Andy Brem, from Asda, said: "The unseasonably mild weather so far this winter has reduced heating oil consumption across Europe and the US.
"This, combined with a fall in the price of crude oil, has helped push prices lower.""This, combined with a fall in the price of crude oil, has helped push prices lower."
The price of oil has fallen sharply since peaking above $78 in July. Asda, which has 167 petrol stations, said its diesel is now at its cheapest for more than a year. Prices for diesel are normally higher during January because of its use in heating.
Oil reached a peak of $78 for a barrel of US light crude in July, driven by the conflict in Lebanon and ongoing high demand spurred by China, but has since fallen as geopolitical tensions have eased.
Oil cartel Opec has said it will take action if prices continue dropping.