The energy industry insisted deep cuts in global oil prices were already being passed on to customers after Chancellor George Osborne announced a review of the impact on items such as fuel bills, air fares and the forecourt price of petrol.
Ministers said concerned industries were being watched “like hawks” and officials were examining what action might be taken if a seven-year low in the global oil price was not adequately reflected in what the public was charged.
Mr Osborne welcomed a move by four major supermarkets to cut 2p from the cost of a litre of petrol as the slump left a barrel of Brent crude trading at its lowest since May 2009, but said more action was required.
After leading a discussion of the issue at Monday’s Cabinet meeting, he said it was, “vital this is passed on to families at petrol pumps, through utility bills and air fares.”
Energy Secretary Ed Davey said: “The government will be watching energy companies like hawks to ensure falls in wholesale gas prices are passed on as quickly as possible to consumers.”
The sector is already the subject of an investigation by the Competition and Markets Authority.
Energy UK chief executive Lawrence Slade insisted cuts in the wholesale price of gas were being passed on in full – with consumers now able to pay £100 less than a year if they looked for the right deals.
Chief Secretary to the Treasury Danny Alexander said: “The fall in oil price is a benefit to most of the UK economy provided that the benefits are passed on at the pumps, in the cost of holidays and in the cost of heating homes.
“We also need to support the North Sea oil and gas sector because that us adversely affected by this, it is the biggest industrial investor in the UK.
“So, that is why we are also putting in place a more beneficial tax environment. But by and large this is a big benefit to everyone else.”
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