Supermarket chains Tesco and Asda and JD Wetherspoon, the pub group, have kicked off the new year with aggressive price cuts that will include the return of the 99p pint at hundreds of British pubs.

Asda, part of Wal-Mart, the world’s largest supermarket group, said that it would cuts prices on 1,000 items ranging from fresh and frozen foods to bakery products and toiletries in its 350 stores.

Tesco said it would widen a similar round of cost-cutting already in place across its lines, adding that it would chop 3p off the price of a litre of diesel and unleaded fuel at its 350 petrol stations — the cost of a barrel of crude oil fell $3.40 to $42.20 today after an unexpected spike in the price on December 31.

JD Wetherspoon, known for its regular drink discounts, said it would be selling pints of Greene King IPA for 99p — back to 1989 prices — and that it was slashing several of its pubs meals to £2.99.

The offers, which begin next Monday and will include 99p bottles of San Miguel beer, will run indefinitely, JD Wetherspoon said.

John Hutson, chief executive of Wetherspoon, said: "People enjoy going to the pub. We believe that our new food and drink prices will allow people to enjoy a visit to a Wetherspoon pub without it costing them too much."

The cuts come as retailers and the leisure industry brace themselves for a difficult year, with analysts predicting significant cuts in consumer spending.

Andy Bond, chief executive of Asda, said: “2009 is going to be a very difficult year and I believe we have an obligation to help our customers through these tough times.”

News of the price reductions follow predictions from the British Retail Consortium that 2009 would be a year of heavy discounting.

However, analysts warned that steep cuts will not be enough to save some retailers. Howard Archer, an economist at IHS Global Insight, said this year would be “desperately difficult” for retailers.

“This will keep pressure on them to price competitively through 2009, which will obviously impact on margins. As a result, many more retailers seem likely to go under.”

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