The average price of unleaded petrol in the UK has surged to 158.52p per litre, marking its highest point since the commencement of the Iran war. This significant increase, reported by the RAC, reflects broader global market dynamics and regional conflicts impacting energy supply.
Following the outbreak of the conflict on February 28, both petrol and diesel prices experienced a sharp rise. This escalation was attributed to disruptions in energy production and transportation across the Middle East, caused by missile strikes and drone attacks. These events led to a slowdown or complete halt in the movement of energy resources.
The price of petrol had previously peaked at 158.31p on April 15. It subsequently saw a slight decrease of over a penny until early May, after which it began to climb again, according to RAC data. The motoring organization forecasts that unleaded petrol prices could potentially reach at least 160p per litre in the upcoming weeks, barring a substantial and ongoing reduction in global oil prices.
Currently, Brent crude, the international benchmark for wholesale oil prices, is trading at approximately $111 per barrel. This is a considerable increase from its pre-conflict price of around $73 per barrel. The rise in crude oil prices directly contributes to the higher costs consumers face at the pump.
At the start of the conflict, the average price for unleaded petrol stood at 132.83p per litre, while diesel averaged 142.38p per litre. The current average price for diesel has now reached 185.92p per litre.
Amidst these rising fuel costs, there has been speculation about the government's plans regarding fuel duty. Simon Williams, RAC head of policy, noted that the Chancellor was reportedly considering scrapping a planned one-penny increase in fuel duty scheduled for September. Such a move would have been the first step in reversing the 5p fuel duty cut implemented during the Ukraine war. Williams emphasized that maintaining the current fuel duty rate of 52.95p per litre would offer relief to drivers who are already struggling with the elevated cost of filling their vehicles.
While the outlook for diesel prices appears more positive due to a significant reduction in wholesale prices since early April, Williams stated that the pump price for diesel, despite falling to its lowest point since the beginning of the previous month, should be considerably lower. He urged fuel retailers to pass on the savings from reduced wholesale costs to consumers at the forecourt.
Analysts predict that oil prices are likely to remain above $100 per barrel for the remainder of the year, suggesting that drivers may continue to face high fuel costs in the near future.
