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However the RAC says the Government is now collecting £46 from every full tank of fuel and called for further cuts in duty.

In a letter to the Competition and Markets Authority (CMA), Kwarteng wrote that people were “rightly frustrated” that the 5p-a-litre reduction had not stopped prices from soaring to record levels at forecourts.

Kwarteng asked the CMA to conduct an urgent review of the fuel market, and a longer-term study that would examine the health of competition in the market, to examine whether it has hurt consumer interests amid rising prices.

He noted regional disparities in petrol prices, and asked for an initial report of recommendations to “strengthen competition” in the petrol market by 7 July.

“Drivers should be getting a fair deal for fuel across the UK,” Kwarteng wrote.

“I am writing to you to ask that the CMA conduct an urgent review of the fuel market … to explore whether the retail fuel market has adversely affected consumer interests.”

The competition watchdog had previously made Asda and Morrisons sell a number of forecourts during private equity acquisitions.

The average price of a litre of petrol at UK forecourts rose by 7p last week, according to data firm Experian Catalist, hitting a new record of 183.2p on Thursday. That pushed the cost of filling a typical car over the £100 mark.

Today the RAC said average fuel prices have shot up to new records yet again with petrol hitting 185.04p and diesel 190.92p, an increase of 2p a litre on both since Thursday.

This takes the cost of filling a 55-litre family car with petrol to £101.77 and has led to the first ever £105 fill-up for diesel,” RAC fule spokesperson SImon Williams said.

“Incredibly, the Government is now raking around £46 in tax from every full tank,” he said.

“The speed and scale of the increase is staggering with unleaded going up 7p in a week and diesel by nearly 6p. This must surely put more pressure on the Government to take action to ensure drivers don’t endure a summer of discontent at the pumps.

“We hope the Government’s persistent talk about the importance of retailers passing on March’s 5p duty cut fully is a precursor to an announcement of a deeper cut this week. If that’s the case, it’s very welcome, albeit overdue as the 5p cut has been well and truly overtaken by events on the wholesale market since then.”

Petrol retailers have blamed surging wholesale prices, saying oil refineries had not passed on a fall in the price of crude oil since the highs during the early days of the war in Ukraine.

Jack Cousens, the AA’s head of roads policy, welcomed Kwarteng’s move but called for “more urgent action”.

“To relieve pressure at the pumps we need an immediate 10p cut to fuel duty,” he argued.

“Longer term, the CMA should consider extending the pump price transparency available in Northern Ireland to the rest of the UK. The Consumer Council’s fuel price checker stimulates competition and has led to drivers there enjoying the lowest fuel prices in the UK,” Cousens said.

Trade unions and drivers have warned that the record increase in fuel prices could force staff who rely on their vehicles for work to quit, including essential workers.

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Diesel also rose to yet another record by reaching 185.2p which takes the cost of a tank to £101.86.

RAC fuel spokesperson Simon Williams said: “With analysts predicting that oil will average $135 a barrel for the rest of this year drivers need to brace themselves for average fuel prices rocketing to £2 a litre which would mean a fill-up would rise to an unbelievable £110.

“The oil price is rising due to increased demand for fuel across the world as China eases its Covid restrictions and America and Europe go into the peak summer driving season. All this combined with a weaker pound at $1.2 means wholesale fuel costs more for retailers to buy.

“The wholesale price of diesel is fast approaching 160p a litre which, when you add 7p retailer margin and 20% VAT, would take the pump price over the £2 mark.

“We strongly urge the Government to take drastic action to help soften the impact for drivers from these never-before-seen pump prices.”

The RAC said the price of petrol surged by nearly 5p a litre in the week that included the bank holiday break, the RAC says, and could soon hit 180p a litre.

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Figures from AA Ireland show fuel prices have increased by more than a third in the past two years. Petrol prices at the pumps are now close to €2 a litre.

In the past two weeks alone prices have jumped around 2c a litre, with the relentless cost increases putting huge pressure on household budgets as the cost-of-living crisis deepens.

Prices at the pumps are now at their highest since AA Ireland started recording them in 1991.

AA Ireland has calculated it will now cost a driver of a petrol car €595 more over a year to buy compared with last year. For those with diesel cars there will be an extra €460 annual cost since costs started surging two years ago.

AA Ireland says petrol prices are now at €1.77 a litre and diesel is €1.68 on average. It means the annual cost of filling a petrol car, for the average motorist, is now €2,149, with diesel drivers paying €1,660 over a year. The figures are based on a vehicle with a 50-litre tank, with mileage at 17,000km.

AA Ireland’s Paddy Comyn said we are getting close to petrol costing €2 a litre.

“What is particularly worrying as we stumble towards €2 per litre for petrol is how this might be affecting lower-income families, especially in rural areas where public transport is imperfect,” he said.

He said reductions in the price of public transport is welcome, but it is little assistance to those people who have no choice but to use their cars to drive children to school, get to work or care for loved ones.

“Even a temporary measure to assist these people could relieve them of a lot of pressure, and with north of 60pc of the pump price being tax, the Government really needs to relieve this pressure,” he said.

According to the AA, around 96c of every litre of petrol and 85c for every litre of diesel goes on taxes. Ireland is the 17th most expensive country in the world for fuel, and ranks 12th in Europe.

Fuels for Ireland, which represents motor fuel retailers, called on the Energy Minister Eamon Ryan to follow through on his promise last November to reduce by 1c per litre the National Oil Reserves Agency’s levy and implement a 1c reduction in excise duty.

Kevin McPartlan of Fuels for Ireland said the failure to carry through on these promised cuts was costing motorists €7m a month.

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