It's possible to cut your annual petrol or diesel bill by a third, saving £100s. As most fuel costs go in tax, it takes more than finding the cheapest fuel prices. Use speedy, pain-free ways to make your car more fuel efficient, and ensure you pay for fuel the right way.
Of course, the trite answer to cutting petrol bills is to use your car less, walk more or take public transport, and all that
benefits the environment too. Yet even if you need to do the same mileage, you can slash your costs hugely, and get there at the same time.
MSE Challenge: The petrol diet!
Once you've read the steps below, why not try the petrol diet? No, we don't advocate swigging the stuff - it's a challenge on the MSE forum, where MoneySavers share tips to help cut their annual fuel spend, track savings, and inspire others.
The forum's proved to be hugely powerful in the past, seeing people work together to get debt-free, pay off mortgages and more. It's free to join in, and open to all - see the Petrol Diet Forum Discussion.
Step 1: Make your car more fuel efficient
Finding cheap petrol is only part of the game - you could see big improvements by making minor tweaks to your vehicle. Thanks to the RAC for help with the efficiency improvement data.
1 Keep your tyres inflated
Fuel efficiency improvement: Up to 3%
Lower tyre pressure increases the drag on a car, meaning you need more fuel, so regularly check the pressures are correct and your car needs less oomph to keep it moving.
2Declutter your car
Fuel efficiency improvement: Up to 2%
The lighter your car is, the less effort it needs to accelerate. By decluttering, clearing out junk from the boot, and not carrying unnecessary weight, you can make extra savings.
3Take your roof rack off
Fuel efficiency improvement: Up to 2%
A roof rack, even unused, adds wind resistance to a car, increasing drag and making the engine work harder. So if you don't need it, take it off, along with anything else that's inefficient. Even closing the windows will make the car run slightly more efficiently.
4Turn off air con at lower speeds
Fuel efficiency improvement: Up to 8%
Though newer cars are getting better on this, air conditioning uses an incredible amount of fuel - so make sure it's turned off unless you really need it.
The general consensus is it's more efficient to drive with the windows down and the air con off at lower speeds, but at higher speeds it's better to use the air con and keep windows up due to the extra drag caused by having windows down.
If you're not using your air con, it's worth turning it on once in a while as not using it can mean it stops working. Also, don't keep the engine running. Drive off as soon as you start up and switch off the engine as soon as you reach your destination. Turn your engine off where possible, eg, in traffic or during big delays on motorways.
5Don't fill it up
Fuel efficiency improvement: Up to 1%
Fuel is heavy, so by filling the car up you're adding quite a weight. The less fuel your car has in it, the more efficiently it drives. Thus filling up slightly more often and putting less in (to 1/2 or 3/4 full) will make the car run more efficiently.
But also don't be tempted to run the fuel too low - winter driving uses more fuel, so your normal range of miles to litres will be less.
Step 2: Drive more efficiently
It's possible to drive the same distance in the same time, yet use considerably less fuel, to chop up to 30% OFF your fuel costs without cutting your top speed. It's simply about driving more smoothly to boost your fuel efficiency.
1 Accelerate gradually without over-revving
Speed up smoothly. Press harder on the pedal and more fuel flows, but you could reach the same speed using much less power. As a very rough rule, stay under 3,000 revs.
2 Drive in the correct gear
Always drive in the highest gear possible without labouring the engine. So change up much earlier than feels natural. Again, a very rough guide (though it varies wildly with each car) is not to go over 3,000 revs.
3 Slow naturally
Rather than brake all the time, let your car slow naturally and use its stored momentum.
4 Think about road position
To do all this takes road awareness. The more alert you are, the better you can plan ahead and move gradually.
In many ways, this all comes down to one little rule of thumb.
Every time you put your foot on the accelerator, remember the harder you press, the more fuel you spend
Just being conscious of this, and your road position, should massively increase how far you can drive on a tank of petrol. It's estimated someone who averages 35 miles per gallon could reach 40 mpg by driving better, a near 15% saving.
The real world impact: Martin's story
On an overseas holiday I got to test this, thanks to a sexy little digital display in my hire car which gave me a km/litre readout. For every trip, I drove normally on the way there and used the "think when pressing the pedal" method above on the way back.
If you're thinking "did he really bother while on holiday?" - yes I did, and I loved it. Luckily my girlfriend (now my wife) is very understanding!
The improvement is enormous!
Overall, I drove about 500 miles. and the different 'efficiency' averages per litre of petrol were incredible: for normal driving, it was 11.2 kilometres per litre, but for efficiency-conscious driving, a remarkable 13.4 kilometres per litre.
Most intriguingly, the efficient driving didn't cost me any time at all, and on motorways my top speed didn't change. Others drove harder, only to brake harder at the next traffic light...
For someone spending roughly £50 a week on fuel, an equivalent 20% efficiency increase would save around £500 a year. And, according to the RAC, boy racers could expect annual efficient driving gains of up to 30 per cent!
The easiest way to find the cheapest forecourt in your area for petrol, diesel and LPG (and more) is by using the free website PetrolPrices.com to compare fuel prices.
After registering, enter your postcode and tell it how far you're willing to travel (2, 5, 10, 15 or 20 miles) and it'll list today's cheapest petrol stations in your area for unleaded, diesel, LPG and other fuels. A quick check before you need to fill up should be enough to save you serious cash.
Note: Based on average UK unleaded price & percentage data from PetrolPrices.com as of 3 Jan 2013. VAT is 20% of all the other costs.
In October 2013, for a sample postcode the average unleaded price was 134p/litre, the highest price was 137p and the cheapest price 130p.
This type of variance is typical, regardless of the actual numbers.
While the difference is only pennies, in percentage terms that means about 5% cost-cutting could be possible. So for someone who fills up £50 a week, it's a reduction of about £100 a year.
We've worked with PetrolPrices.com to build a quick tool to show you the target cheapest price you should be aiming for.
Then to find the specific prices it shows, you'll need to sign up, for free, via its site. PetrolPrices.com has told us prices are updated every weekday around noon, so factor this in.
Find your target fuel price
The easiest way to cut the price you pay is to use this quick tool to find the target cheapest fuel price you should be paying in your local area. Just enter your postcode and click submit.
Grab cheap petrol promotions
Supermarkets commonly run petrol promotions, and as they're usually cheap for fuel anyway, utilising these schemes means you can save. Usually these take the form of "spend £50 and get a 5p off/litre voucher" deals. The best of these promotions are always included in the free weekly MoneySaving email.
Morrisons: free tank of petrol? Big spenders' extreme couponing
This is an awesome bit of extreme couponing. It's fiddly and only works if you're already planning to make a big purchase at certain high street stores, such as Homebase or Currys. But play it to the max and you could potentially get a free tank of petrol.
How it works
Morrisons' Fuel Saver deal gives 1p/litre off petrol, diesel or LPG for every £10 of gift cards bought in-store.
There's a huge number of retailers to buy gift cards for, including Homebase, Debenhams, Currys, Pizza Express, Next, House of Fraser, Halfords, iTunes, TK Maxx, Oasis, Warehouse and Waterstones - see the full list. The offer's ongoing, but doesn't include Morrisons' own gift cards.
The discount's also stackable, so you can buy £50 of gift cards and get 5p/litre off. So if there's a large purchase you are going to make anyway - eg, £500 on a computer at PC World or a garden shed at Homebase - get it by first buying the gift cards and you'll bag 50p/litre off.
If you bought £1,400 of gift cards, it'd effectively make a £1.40/litre tank FREE. Morrisons has also told us there's no limit per transaction on the gift card. But the maximum coupon value you could get for one transaction is £1 off per litre. A £1/litre off voucher would be issued if you spent £1,000 on gift cards.
Petrol vouchers are valid for 63 days from the issue date. Forumite matthewh notes:
"It really depends on if you were going to spend the money anyway! We were going to buy sofas at Next anyway - so I bought enough gift cards in Morrisons to cover the full price of fuel. Then bought the sofa with the gift cards - so I got nearly a £100 discount."
Use gift cards quickly
Gift cards are non-refundable, and it isn't a good idea to put money on the card to drip-spend over six months. Though most of those mentioned here are big, safe companies, if the firm goes bust you'll probably lose the cash, so ensure you minimise the time between buying and redemption.
It's also worth noting third party retailers (Morrisons in this case) don't have any responsibility to refund you if a gift card's retailer goes into administration. See the Beware gift vouchers MSE News story. Gift cards are generally valid for about two years, but always check.
If you’re buying a big item, consider paying for part of it by credit card rather than entirely with the gift vouchers, if you can. This means you’d get Section 75 protection in case something went wrong.
Buying petrol is a regular outlay, and you spend more on it in a year than you think - £30 a week is over £1,500 a year! As many petrol stations (including the supermarket ones) run some form of loyalty scheme, it's worth signing up to schemes for the forecourts you'll use most regularly to get a little bit extra back.
However, never choose a petrol station just for its loyalty scheme, as the difference is small compared to petrol price variance (also see the Increase Your Loyalty Stash guide)
What about the Pipeline card?
In earlier incarnations of this guide we mentioned the Pipeline card, which aimed to get 100,000 people together to pull off a discount card for up to 5p/litre off petrol. At the time, it seemed worth a punt and cost nothing. Using the power of the MoneySavingExpert.com weekly e-mail, that happened quite quickly.
Sadly, Pipeline never delivered, and still doesn't look like doing so. Now it's taken a turn for the worse, sending emails to its distribution list for its own commercial purposes. As it's never delivered, steer clear and take yourself off the distribution list.
Other filling-up tips
There are several other ways to cut the cost of petrol and diesel:
1 Always fill up at least 50 miles before your tank's dry.
This way, there's no panic and you've enough time to get to a cheaper petrol station. Leave it longer and you'll fill up at "the next one I see", meaning you're not focused on the fuel price.
Of course this is slightly offset by the fact that a lighter car uses less fuel. But with 50 miles of fuel left, the difference is tiny.
2 Only use 'better fuel' if your car can cope.
Many petrol stations sell 'high performance' fuels, yet there's little or no performance difference for most non-performance cars. So only fill up with the super-fuels if you've a sports car you've been specifically advised will actually utilise the petrol correctly.
The AA tells us that for most, high performance fuels are too pricey for regular use. But if you're keen, it suggests using three tankfuls in a row to keep the engine clean and efficient, then revert to normal fuel.
3 Fill up at night..?
Talk of filling up at night getting you more is a slight urban myth, as the differences are minuscule - pennies at best. Petrol pumps are calibrated by volume, so fill up at night when it's cold and you get a tiny, tiny extra bit.
4 Don't try to put more in after the clunk.
While filling up to full isn't great as it adds weight to the car (see Make your car more efficient above), if you must, don't keep going after the petrol nozzle 'clunks'. If you do, you're overfilling.
Step 4: Use a petrol cashback credit card
Cashback credit cards pay you back each time you spend on the card. Traditionally these tended to pay the same rate of cashback whatever you bought, but increasing fuel prices have coincided with a new trend for cards to pay especially high cashback when you fill up your tank.
They are a great way to shave down the cost of fuel, but ALWAYS abide by...
Set up a direct debit to repay the card in full each month, so you never pay interest, which would outstrip any gain.
The reason card companies offer cashback or reward schemes is simple. They want to encourage you to spend on the card and pay them interest. The interest cost of all cashback cards dwarves the cashback you'll earn. For full details on things to consider before applying, see Top Cashback Cards.
Each time you apply for one of these cards, you'll be credit-checked by the lenders. Multiple applications in a short period can impact your future ability to get credit. Read full details in the Credit Rating guide.
The easy way to pay off in full
It's easy to do this via a direct debit, which allows the card company to take a variable monthly amount to correspond with what you owe it. Sadly, some providers deliberately omit the 'pay off in full' option from direct debit forms, as it makes them less money. If so, just write in 'pay off in full'. They should honour it, but call up after a week or so and check it has worked.
The top petrol cashback cards
These are the most lucrative cashback cards for big petrol spenders - have a look through them all and pick the best for you. Also, check out the top overall picks in the Top Cashback Cards guide - as they may be suitable if you spend big in other areas.
The Santander 123* card pays three different cashback rates: 3% on petrol and travel (on up to £300/mth spend), 2% in department stores and 1% in supermarkets.
It has an annoying £24 annual fee, but if you open a Santander 123 account, or if you already have one - it's one of our top pick bank accounts - the fee is refunded in the first year. If this doesn't apply to you, to take full advantage you must drive or use public transport a lot, otherwise different cards beat it. Ensure you repay in full every month to avoid the big 18.9%
APR on spending.
One downside is that any spending outside of the specified categories attracts NO cashback (as does fuel or transport spending in excess of £300/mth) - if you are likely to do this, consider if other cards are more lucrative.
Here are some examples of which retailers qualify for the various cashback, not all branches are eligible, so check your local retailers:
Fuel and transport - 3%. Includes BP, Shell, Esso, Texaco, Tesco, Asda, Morrisons, Sainsbury's, National Rail and Transport for London (excludes newsagent top-ups).
Dept stores - 2%. Includes Debenhams, House of Fraser, John Lewis, BHS, Selfridges.
Supermarkets - 1%. Includes Tesco, Asda, Sainsbury's, Morrisons, Waitrose, M&S.
This is done by the retailer's 'merchant number', and there's a possibility some will be categorised differently to what you'd expect. You've little comeback if they are, but it's worth being aware.
Cashback: 3% on petrol/transport (max £9/mth), 2% in dept stores, 1% in supermarkets, NONE elsewhere
Paid out: Monthly
Max cashback limits?: £9/mth petrol/transport
Annual fee: £24
Min spend: N/A
Rate: 22.8% representative APR (incl fee). 18.9% rep. APR on spending (see Official APR Example)
New American Express Platinum Everyday* customers get a huge 5% cashback, but only for the first three months and only on spending up to £2,000. After that, cashback's tiered up to 1.25%, so it can beat Santander, depending on what other spending you do on the card.
After this, spending attracts tiered rates of cashback. Spend £0 to £3,500 and you get 0.5% cashback on that spend. From £3,500 to £7,500 and you get 1% on that portion of spending. All spending above £7,501 attracts the full 1.25% cashback. However, you'll get NO cashback if your total spending in a year is under £3,000.
However, make sure you repay in full each month, otherwise it's 19.9%
APR. To get one, you must earn £20,000 or more per year.
Cashback: 3mths 5% (max £100) | Up to 1.25% after.
Paid out: On card anniversary
Max cashback/year: N/A
Annual fee: None
Min spend: £3,000
Rate: 19.9% representative APR (see Official APR Example)
Existing AA Breakdown or Loyalty Club members can apply for the AA Rewards credit card, which gives 1% cashback on all petrol purchases. You'll earn 0.5% back on other purchases. Non-members can apply for the card, but will earn cashback at half the rate.
The rewards come as AA points, which can be turned into cashback, gift vouchers or spent on AA products. It's a good card for big petrol spenders who are AA members - and there are often good deals for AA's basic breakdown cover.
If you don't want to pay a fee, this card is the best for fuel cashback. However, at 1% back on fuel, it is beatable by Santander's 3% (max £9/mth). Remember that Santander has a £24 annual fee. Always repay in full each month or it's 16.9%
An easy way to cut petrol costs is to drive less! One option is to share lifts to work with friends. There are a few sites that connect people doing the same journey.
Liftshare. Register your details on Liftshare (it says it never uses these for marketing purposes) and enter the journey you'd like to share. Then check its search results for matching commuters. You can also opt for weekly or monthly emails alerting you to new matches, and it also lets you search for potential matches before registering.
The site's been going since 1998 and Liftshare says it's the largest car-sharing network in the UK. It reckons a daily commuter sharing a journey can save around £1,000/year. You'll also find a nifty savings calculator to help work out how much your journey costs, plus how much you could save by sharing with others.
Carpooling. Website Carpooling (it used to be called Rideshare) lets you see possible matches before registering, then lets you register to get in touch if you find a match.
It has over five million registered users across Europe, not just the UK, and is generally better for longer trips. For extra safety, it also allows you to only travel with 'authenticated' users who have proven their ID, and offers a rating system that lets you read reviews on users you're considering sharing a lift with.
BlaBlaCar. Founded in France in 2006, BlaBlaCar came to the UK in 2011 and has three million users across Europe. It lets you search for potential matches without registering, but you'll need to register for free via Facebook or email to contact a driver or offer a lift.
Anything to watch for?
Be safe The sites store details securely, but when it comes to travelling it's important to be vigilant. Arrange to meet for the first time in a public place, let friends or relatives know what you're doing and check their ID to ensure they are who they say they are.
Taking passengers shouldn't affect insurance If you're giving a lift to someone and asking for a contribution towards petrol costs, the Association of British Insurers says that provided there's no element of profit, your car insurance is unlikely to be affected.
However, to be completely sure, check with your provider first. Liftshare has a good template letter you can use.
Successes by using the five-step cheap petrol system
'Do it - you'll be surprised'
Thanks to driving tips from @MoneySavingExp, I have saved myself £20 in fuel in 1 month, driving more carefully. Do it, you'll be surprised.
MoneySaver @mathewhasker on Twitter
'I doubled my fuel economy!'
Over the last 2 years I have almost doubled my fuel economy, without changing vehicles.
1. I drive much more smoothly and don't overtake other car users just to get one or two places further along in a big queue.
2. I leave for work a little later and return home a little later- as a result I no longer spend 30 mins plus on a 4 mile crawl through stop/start traffic on a 26 mile (each way) commute into and out of the city of Aberdeen.
My blood pressure is also lower!
'20 extra miles per tank!'
Results I've got from trying to drive more fuel-efficiently. Most of this has been city driving:
Previously, 33-35 litres gave me around 215 miles.
Driving more carefully increased this to around 235 miles.
Turning engine off at lights increased my mileage to 293 miles.
How much can you save?
The savings from following the five-step system can be huge. For someone who drives 15,000 miles a year averaging 35 miles per gallon (12.4 km/litre), just buying petrol at the average UK cost is £2,610 as of October 2013. By following all these steps, the reduction could be over 20%, cutting the bill by £570 a year.
To work out the initial approximate cost of running your car, the Gov.uk website has a fuel consumption search tool (it's best for new cars) which will help you work out roughly how much it'll cost you to run your car.
Motoring website Honest John also has a handy 'real MPG' section where drivers have reported the miles per gallon they actually get.
Average annual cost (1)
Increase fuel efficiency by 5%
Increase fuel efficiency by 20%
Plus reduce fuel cost by 5% (2)
Plus get 1% cashback
(1) Cost at 35 miles per gallon (12.4 km/litre) at 134p/litre. (2) After increasing fuel efficiency by 20%, fuel cost reduced to 127p/litre. Last updated October 2013.
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With credit cards, the rate for purchases (as opposed to balance transfers or cash withdrawals) is used as the main rate to advertise the card.
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