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Diesel prices fell by a record 12p per litre on average in the UK last month, according to the RAC.

Pump prices dropped from about £1.59 to £1.47, the group said, cutting the cost of filling up a family car by £6.50.

The RAC said the reduction was the largest monthly drop it had seen since it began monitoring prices in 2000.

But the motoring group argued the drop in price was "both long overdue and smaller than it should be" due to wholesale prices being lower.

The British Retail Consortium, which represents supermarkets, said "big cuts" had been made to diesel prices in response to falling wholesale costs.

Diesel prices are now down more than 25% from 2022 highs, after falling for seven months in a row.

The fuel hit a £1.99 per litre high last summer after oil prices soared following Russian's invasion of Ukraine.

Petrol prices have also been falling steadily since then and dropped from £1.46 to £1.43 on average last month, figures from the RAC said.

The motoring group has suggested that prices have not come down as fast or by as much as they should have, noting that prices were significantly lower in Northern Ireland.

The RAC said the cut should have been more significant to fully reflect changes in the wholesale market because diesel wholesale costs had been lower than petrol for 10 weeks.

In May, the Competition and Markets Authority (CMA) announced it was investigating fuel prices and whether a "failure in competition" had meant drivers overpaid.

The watchdog said it was "concerned about the sustained higher margins on diesel compared to petrol" so far this year.

It said evidence it had gathered so far suggested at least one supermarket had set a higher target for its profit margin on fuel prices in 2022, which could have led rivals to follow suit and raise prices too.

The RAC said after calling for prices to fall in recent months, it seemed "ironic that the latest price cuts have finally come in the two weeks following the Competition and Markets Authority's announcement".

"What's happened to the price of diesel in May will no doubt give the CMA something to think about," Mr Williams said. "We strongly hope the pump price reductions continue as they should."

Gordon Balmer, executive director of the Petrol Retailers Association, which represents thousands of independent forecourts, said its advice to drivers was to "shop around".

"As noted by the CMA, petrol and diesel prices are still volatile due to the ongoing war in Ukraine. The market is very dynamic and independent forecourts are in many cases undercutting supermarkets on price," he added.

A separate review of the fuel market has been ongoing for several months, over initial concerns that retailers and forecourts were failing to pass on a 5p fuel duty cut to motorists.