Retail associations have welcomed an Office of Fair Trading probe into fuel pricing.

The OFT said earlier this week that “in light of continuing public concern about pump prices”, it wanted to identify whether or not there were “competition problems” in the sector.

“We are keenly aware of continuing widespread concern about the pump price of petrol and diesel and we have heard a number of different claims about how the market is operating,” added Claire Hart, a director in the OFT’s services, infrastructure and public markets group.

The Petrol Retailers’ Association said “much had changed” since the sector was last looked at 14 years ago.

“RMI Petrol submitted a detailed report to the OFT earlier this year, asking for a ‘market study’ under the terms of the Enterprise Act 2002,” said PRA chairman Brian Madderson.

“We highlighted potential flaws in price referencing systems as one of the fuel price mechanisms needing proper investigation. Businesses, motorists and independent retailers all need much greater price transparency and we call on the government to support the request for the OFT study.”

The Forum of Private Business, meanwhile, pointed out that since 2007 fuel prices had risen dramatically above the rate of inflation, with diesel spiking at nearly £1.50 earlier this year.

“Every motorist knows it – and that is when crude oil prices go up forecourt prices quickly follow suit. But when they come down again pump prices are slow to do the same,” said the FBP policy advisor Robert Downes.

“Hopefully this OFT investigation will lift the lid on who is really to blame for this kind of trickery. Is it the petrol stations, is it the suppliers, or both? The facts are there is real concern among businesses that they are being squeezed unfairly, and frankly this investigation is way overdue.”

The OFT will be gathering information over the next six weeks, and plans to publish its findings in January 2013.