The fuel tax cut will cut the cost of filling an average tank, which has fallen to £98.43 for diesel and £91.87 for petrol, by just £3.30, according to RAC Fuelwatch.
Motoring groups have welcomed the reduction in fuel duty, which is only the second time in the past 20 years that the rate has been reduced.
Ministers have frozen fuel taxes since 2011 at 57.95pa liter which campaigners say has saved motorists £100billion over the decade.
“The Chancellor has come to the aid of British families and businesses who use their vehicles, not for pleasure, but to function in their daily lives,” said AA President Edmund King.
“Since the beginning of the year, soaring prices at the pump of 20 cents a liter have been the shock that has shaken the finances of families, and in particular young drivers, retirees and low-income workers who have to move every day.”
Ian Plummer, chief commercial officer of AutoTrader, said a more generous cut would have been difficult for the Chancellor. He added: “In a climate of record prices at the pump, drivers may struggle to register the chancellor’s gift, but the statement had to strike a difficult balance between helping families and protecting public finances after the pandemic.”
The RAC, however, warned that the prizes may not be passed on immediately.
“In reality, cutting it by 5p will only bring prices back to where they were just over a week ago,” said chief policy officer Nicholas Lyes.
“With the reduction taking effect at 6pm tonight, drivers will only notice the difference at the pumps once retailers have purchased new fuel at the lower rate.
“There is also a very real risk that retailers could simply absorb some or all of the tariffs themselves by not lowering their prices. If this turns out to be the case, it will be disastrous for drivers.