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Could diesel be about to drop below £1 per litre?

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Diesel fuel prices are dropping on forecourts around the country and could fall as low as £1 per litre, as supermarkets wage a pump price battle, reports fleet operators' organisation ACFO.

Morrisons has slashed its diesel prices by 4p per litre to around 107p a litre and also cut petrol prices by 1p, offering it for an average of 112p a litre.

Tesco, Sainsbury's and Asda have also been reviewing the price of diesel. They've shaved 2p per litre off the cost of diesel, as well as 1p off unleaded petrol.

According to the RAC, there's a real chance that prices could dip as low as £1 per litre.

"July was a bumper month for diesel vehicle drivers with the average price falling by 5p a litre, saving £3 on a fill-up. Now August is off to a flying start with another substantial cut which will help shave another couple of pounds off a tank of diesel," said a spokesman.

With an abundance of diesel, lower wholesale oil prices and the relatively strong pound against the dollar, there is a real prospect we will see diesel at £1 a litre, he said.

Prices will probably continue falling until diesel production is cut, he added.

The price of diesel is now cheaper than petrol for the first time since 2001, and the last time we saw fuel prices below £1 per litre was in 2008.

Currently, the average price of a litre of diesel is 113.77p, and for a litre of petrol it's 115.58p, according to price comparison website petrolprices.com.

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