UK petrol prices hit highest level since start of Iran war
The average price of unleaded petrol in the UK has risen to 158.52p a litre, its highest level since the start of the Iran war, according to the RAC. The motoring organisation said the increase comes after fuel prices surged when the conflict began on 28 February, with energy production and transport across parts of the Middle East slowing or stopping because of missile strikes and drone attacks. Diesel has also remained elevated, with the average price now at 185.92p a litre.
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The RAC said petrol had previously peaked at 158.31p a litre on 15 April, before easing by more than a penny until the start of May, when it began rising again. It warned that unleaded could climb to at least 160p a litre in the coming weeks unless there is a "dramatic and sustained drop" in the price of oil. The organisation also said Brent crude, the global benchmark for wholesale oil prices, is currently trading at about $111 a barrel, compared with about $73 before the conflict.
The rise matters because it feeds directly into the cost of motoring for households and businesses. The RAC said the average price of unleaded petrol was 132.83p a litre at the start of the conflict, showing how sharply pump prices have moved since then. Simon Williams, the RAC's head of policy, said the latest increase came in a week when the chancellor was thought to be close to scrapping plans to raise fuel duty by a penny in September.
Williams said that would have been the first step in reversing the 5p fuel duty cut that has been in place since the Ukraine war. He said keeping fuel duty at the current rate of 52.95p per litre would be a relief for drivers, who have been struggling with the higher cost of filling up. The Treasury has said it does not comment on tax speculation.
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The latest figures also underline how the conflict has affected wider energy markets beyond the immediate fighting. The RAC said the disruption to production and transportation across the Middle East has helped push up wholesale oil prices, which in turn has fed through to forecourt prices in the UK. It also said the outlook for diesel was more positive because the wholesale price has fallen significantly since peaking in early April, although it added that diesel at the pump should be lower than it is.
What remains unclear is how long the current pressure on oil prices will last and whether retailers will pass on any further wholesale falls to drivers. The RAC said petrol could rise further unless there is a sustained drop in oil prices, while the Treasury has not commented on the fuel duty speculation. The next developments to watch are whether Brent crude moves lower, whether pump prices continue to rise in the coming weeks, and whether any government decision is made on fuel duty.
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