Fleets could save 1p a litre on unleaded and 2p on the cost of diesel after Asda announced it was cutting its fuel prices.

Drivers filling up at the supermarket’s 180 UK forecourts will now not pay more than 111.9p for unleaded and 114.9p for diesel.

Asda says it's committed to holding down these prices for at least two weeks, ensuring they are in place until after the August bank holiday weekend.

The price cut comes as fleets are being warned to expect a significant rise in the cost of fuel in the coming weeks.

It is predicted that petrol will reach a record £1.26 a litre by the end of the year. The previous high was £121.6 in May.

The warning comes from the Retail Motor Industry Independent Petrol Retailers Association (RMI Petrol), which said prices could increase by 3% be the end of this month and 8% by the start of 2011.