MOTORISTS have received an early Christmas present in the form of further fuel cuts by supermarkets.

Asda, Tesco, Morrisons and Sainsbury's all announced they were reducing the price of their petrol by 2p a litre and also knocking 1p a litre off their diesel.

The Tesco cut takes effect from lunchtime today (Friday, December 12), while the other three big supermarkets will introduce the lower prices from tomorrow.

The Asda reduction will take its petrol down to 112.7p a litre - the cheapest since October 2010 – and its diesel will drop to 118.7p a litre.

At the moment, the average price of unleaded across the North East and North Yorkshire region stands at around 118p a litre as prices have been steadily dropping over recent weeks thanks to falling world oil prices.

Asda's petrol was as high as 126.7p a litre on September 28 this year so will have dipped 14p a litre by the time tomorrow's cut comes into effect.

RAC fuel spokesman Simon Williams said: "Pump prices are really beginning to tumble in line with the fall in oil prices which will make visiting friends and family far cheaper this Christmas than last year.

"This latest round of cuts, which will no doubt be reflected by other retailers, should have a very healthy downward effect on the average petrol price of 119.10p.

"With oil now at the July 2009 price of 63 dollars a barrel and the pound still maintaining a steady 1.5 dollars there is a real sense average petrol prices could come down as low as 110p a litre, with diesel possibly dropping below 118p."

AA spokesman Luke Bosdet said Tesco's reduction alone could knock the UK's average price of petrol down by 1p a litre over the weekend.

He went on: "With UK drivers consuming around 49 million litres of petrol a day, just 1p off the average price redirects nearly £500,000 a day away from the petrol pump into potential high-street spending.

"That would not only be a boost to families looking to stabilise their budgets after years of hardship but also an injection of cash into Christmas shopping and the stores that rely on it."