ASDA has sparked a likely supermarket petrol price war by cutting its fuel prices.

From tomorrow the company is reducing the price of its petrol and its diesel by up to 2p a litre.

Asda customers will pay no more than 126.7p a litre for petrol, with diesel being 129.7p a litre - its lowest price since January 2011.

Asda said a strengthening pound against the dollar had been the key driver behind the cuts.

The company's petrol director Andy Peake added: "We're giving our customers and holidaymakers the opportunity to fill up their cars with some of the cheapest fuel prices in the market for years."

RAC spokesman Simon Williams said: "The combination of the strengthening pound and the fact that tensions in both Ukraine and Iraq have not caused supply issues means wholesale prices have begun to ease again.

"The impact of the shale oil extraction in the US is also causing global oil prices to reduce due to more product becoming available in the market which in turn reduces reliance on importing oil from the Middle East.

"But falling wholesale prices don't always lead to cheaper forecourt prices so it's good news for motorists that this reduction is being passed on so quickly at the pumps. Cheaper fuel is good for individual motorists, businesses and the economy."

© Press Association 2014