Sainsbury's in Stratton St. Margaret and Tesco, in Ocotal Way, have reduced the price of diesel following a report in the Advertiser of a petrol price war.

On Thursday we told how Asda Wal-Mart, in the Orbital Shopping Park, had slashed the price of unleaded from 79.7p a litre to 76.9p- the lowest price since April 2004.

Not to be outdone Tesco matched the price reduction the same day with Sainsbury's later following suit.

Now in a bid to undercut Asda, Sainsbury's have reduced the price of diesel from 81.5p a litre to 80.9p with Tesco doing the same.

Spokesperson for Sainsbury's, Abbi Irving-Bell, said: "We always aim to match our competitors on price.

"We have a local pricing policy and we are commited to offering the lowest price in the area."

Tesco spokesman Tom Siveyer said: "Tesco won't be beaten locally on petrol prices."