Petrol and diesel prices have reached record highs, according to new figures.

Statistics from data firm Experian Catalist show the average cost of a litre of petrol at UK forecourts on Tuesday was 167.6p.

The Competition and Markets Authority (CMA) warned that retailers could be fined if it launches a formal investigation into the sector.

The previous record price for petrol of 167.3p per litre was set on March 22, the day before a 5p cut in fuel duty was implemented by Chancellor Rishi Sunak.

Diesel prices continue to climb to new highs, reaching an average of 180.9p per litre on Tuesday.

That was the same day Business Secretary Kwasi Kwarteng wrote to fuel retailers “to remind them of their responsibilities” amid claims they had hiked profits following the reduction in duty.

RAC analysis found retailers’ average profit margins for a litre of petrol and diesel are currently 11p and 8p respectively.

In the month up to the duty cut it was 9p for petrol and 6p for diesel.

RAC fuel spokesman Simon Williams said: “While the average price of both petrol and diesel would have been far higher without the historic duty cut, it’s also unfortunately the case that drivers haven’t seen the full benefit at the pumps due to major retailers upping their margins.”

Despite his best efforts, the Chancellor must feel like King Canute having tried to reverse the tide of rising pump prices

He added that drivers are “feeling never-before-seen pain at the pumps”, which is “contributing to the worsening cost-of-living crisis”.

AA fuel price spokesman Luke Bosdet said: “Despite his best efforts, the Chancellor must feel like King Canute having tried to reverse the tide of rising pump prices.

“At least though, he can say that UK drivers would be £2.75-a-tank even more worse off now had he not tried to take action in March.

“He hasn’t been helped by a fuel trade that, despite a 16p-a-litre fall in petrol costs that coincided with the spring statement, couldn’t even pass on the full 5p fuel duty cut and the 1p VAT reduction that it brought with it.”

In his letter, Mr Kwarteng said the British people were “rightly expressing concern about the pace of the increase in prices at the forecourt”, and are “rightly frustrated that the Chancellor’s fuel duty cut does not appear to have been passed through to forecourt prices in any visible or meaningful way”.

I have been reassured that (the Competition and Markets Authority) will not hesitate to use their powers to act against petrol stations if there is evidence that they are infringing competition or consumer law

The Business Secretary said that, as a result of “perceived intransigence to date”, his officials recently engaged the Competition and Markets Authority about the issue, and the regulator had been “closely monitoring the situation”.

“I have been reassured that they will not hesitate to use their powers to act against petrol stations if there is evidence that they are infringing competition or consumer law,” he added.

CMA chief executive Andrea Coscelli said: “The CMA stands ready to take action should there be evidence that competition or consumer protection law has been broken in the fuel retail market.

“We will continue to work with the Business Department to monitor and analyse developments which will build on the good knowledge base we have accumulated during some of the recent mergers we have intervened on in this sector.

“If sufficient evidence emerges that the fuel tax cut has not been passed on to consumers, this would be an indication that competition is not working well in this market.

“In that case we would consider launching a formal investigation, which could ultimately lead to fines or legally binding commitments from companies to change their behaviour.”

Gordon Balmer, executive director of the Petrol Retailers Association, which represents independent forecourts, said retailers’ margins were “often not enough to cover operating costs” due to additional expenses such as storage and delivery.

He added that while the Chancellor announced the fuel duty cut, “oil prices rose and effectively cancelled out the reduction”.