UK drivers are paying the most for diesel in all of Europe, according to car and breakdown services company the RAC.

The average cost for a litre of diesel is 155p, 5p more expensive than the second highest average amount of 150p a litre paid in Ireland and Belgium.

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Unleaded costs aren’t as comparatively high, only the 11th most expensive in Europe at an average of 149p.

There is “no good reason” for the high diesel price or for retailers in the UK not to cut pump prices at the pumps, the RAC said.

Why are prices so high?

The margin retailers are charging – the difference between wholesale costs and the amount it’s eventually sold for excluding VAT – is significantly above the long-term mean, according to RAC figures.

Lack of competition can be blamed for the sum, the company said.

“It’s important to note that in Northern Ireland, where there is greater competition for fuels in the absence of supermarket dominance, the average price of diesel is just 144.9p – 10p less than the UK average, and petrol is 6p cheaper at 142.4p.”

While the long-term average is 8p a litre, a margin of 18p is being borne by motorists at present, the figures show.

Lower fuel duty

The rise comes despite the government having cut the tax on motor fuels by 5p in March 2022 in an effort to help drivers with high oil costs after Russia’s invasion of Ukraine.

Other European countries which pay more fuel duty still overall pay less to fill up their vehicle tanks, the RAC data shows.

Italy has the same amount of fuel tax – the joint highest in Europe – but there diesel is still currently 7p cheaper than the UK at an average of 148p a litre.

Competition context

The RAC compiled the data using information from competition watchdog the Competition and Markets Authority (CMA).

The CMA had concluded its investigation into margins at supermarket petrol stations, saying increased supermarket profit margins led to drivers paying an extra 6p per litre for fuel in 2022.

In March of this year the regulator said the margins remained “concerning”.

As part of a push for price transparency, a pumpwatch proposal was floated, where forecourts would have to enter prices within 30 minutes of a change to enable drivers to easily access the cheapest petrol and diesel.

Rising costs and crime levels were given as reasons for higher pump prices, the executive director of the Petrol Retailers Association Gordon Balmer said.

“Retailers are grappling with unprecedented levels of theft, along with significant increases in business rates, energy costs, and the National Minimum Wage. These factors inevitably impact the final price at the pump.

“A substantial percentage of diesel transactions in the UK are made using fuel cards, which operate on vastly lower margins. This further compresses the margins available to retailers and contributes to the higher prices seen by consumers.

“Despite the challenges posed by increased operational costs our members remain dedicated to providing fair and competitive prices. The PRA encourages motorists to use resources such as petrolprices.com to find the best deals available.”

Rishi Sunak’s committee of business advisers refused to publicly back the government’s economic policy record on Tuesday amid an escalating row over Labour’s efforts to steal the Conservative Party’s traditional mantle as ‘the party of business’.

Sky News contacted all 15 of the companies represented on the prime minister’s business council to see whether their bosses would publicly endorse the Tories, but none agreed to do so.

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Among the companies whose executives sat on the council – which is thought to have met no more than twice since its launch in January – were BT Group, ITV, Nationwide and Unilever.

Rolls Royce Holdings, the aircraft engine manufacturer, agreed to let its Derby headquarters be used for a campaign speech by Rachel Reeves, the shadow chancellor, on Tuesday, but said it remained neutral.

Its chief executive, Tufan Erginbilgic, has also been a member of Mr Sunak’s business council since its launch.

Some of the 15 companies failed to respond to enquiries from Sky News, while others said either officially or on an unattributable basis that they would remain politically neutral during the election campaign.

One of those involved said its chief executive’s participation in the council was aimed at contributing views in order to influence government policy.

“[Their] involvement is not a direct endorsement of the governing political party’s views as these will be many and varied,” the company said, speaking on condition of anonymity.

Although that neutrality is not unusual for the bosses of major public companies, it highlights the difficulty that the Tories will have in the lead-up to 4 July in persuading major corporate names to publicly back the party.

The Tories have historically trumped Labour in securing public endorsements from big business, but were beaten out of the traps this time with a pro-Labour letter signed by more than 120 businesspeople and published on Tuesday.

None of the signatories of the Labour letter are serving FTSE-100 chief executives, with the only current public company heavyweight on the list being Andy Higginson, the chairman of JD Sports Fashion.

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Ian King, Sky News’s business presenter, revealed later on Tuesday that a number of the companies listed as supporters were dormant, while one of the signatories, WPP executive Karen Blackett, had already left the company she was cited as working for.

Labour also came under fire from Unite, the trade union, for trumpeting the involvement of John Holland-Kaye, the former Heathrow Airport chief executive, because of his use of controversial ‘fire and rehire’ processes during the pandemic.

In the pro-Labour letter, the business signatories said that Britain’s economy was “beset by instability, stagnation, and a lack of long-term focus”.

Sky News revealed last week that the Tories have contacted business leaders since Mr Sunak called the election, asking them to take part in broadcast media opportunities, provide quotes in support of manifesto pledges and host events and visits for cabinet ministers.

Those efforts are being spearheaded by Lord Petitgas, the former Morgan Stanley executive, who for months has been the prime minister’s special adviser on business.

Tory insiders dismissed the Labour letter as “a damp squib” which showed that Sir Keir Starmer and Ms Reeves had “completely failed to win the trust of major companies in the UK”.

Rishi Sunak will meet leading Conservative Party donors on Monday evening as he seeks to mobilise financial support for the surprisingly timed general election campaign he triggered last week.

Sky News understands that the prime minister will have dinner with a small group of long-standing and more recent donors as the Tories target millions of pounds in fresh contributions to fund their push to retain power.

This weekend, Lord Spencer, the City billionaire, said he was giving £250,000 to the Conservative campaign, although a leaked party memo reported by The Times on Monday suggested it was so far struggling to raise money.

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The dinner will take place as Labour prepares to unveil a list of senior business figures who are endorsing the party ahead of the 4 July election.

A draft letter circulated to private sector bosses late last week, and reported by Sky News, accused the Tories of presiding over an economy “beset by instability, stagnation, and a lack of long-term focus”.

Labour refused to comment on the identities of those who had signed the letter prior to its publication, although there was speculation that Sir Jim Ratcliffe, the Ineos founder and Manchester United Football Club joint-owner, had been invited to do so.

One Labour official denied that Sir Jim, a Monaco resident who this month said he thought that Sir Keir Starmer would do “a very good job at running the country”, was among the list of signatories.

The draft letter, designed to aid Sir Keir’s bid to reposition Labour as the natural party of business, said the UK “has the potential to be one of the strongest economies in the world” but added: “A lack of political stability and the absence of consistent economic strategy has held it back.”

“Labour has shown it has changed and wants to work with business to achieve the UK’s full economic potential,” it added.

“We should now give it the chance to change the country.”

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A number of FTSE-100 chiefs, some of whom have traditionally signed pro-Conservative letters in the run-up to elections, are understood to have been approached to sign it.

One said it was “too political” for him to sign, but Labour allies insisted on Monday that the party had assembled an “impressive” list of signatories.

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Sky News revealed last week that the Tories have contacted business leaders since Mr Sunak called the election, asking them to take part in broadcast media opportunities, provide quotes in support of manifesto pledges and host events and visits for cabinet ministers.

It was unclear on Friday whether the Tories would seek business signatures for a public letter similar to the one being prepared by Labour.

A Conservative Party spokesman declined to comment on Monday’s dinner with the prime minister or to identify those he was meeting.