UK motorists face an additional £1 billion in fuel expenses due to the Iran conflict, with costs surpassing £920 million as of last night. This milestone arrives amid surging pump prices and heavy Easter travel, pushing average diesel rates near a record £2 per litre.
Pump Prices Surge Amid Conflict
Diesel prices climbed to 190.62p per litre yesterday, just 9p shy of the 2022 peak triggered by Russia’s Ukraine invasion. Prices have risen 34% from 142.38p on February 28. Petrol averages now stand at 157.71p per litre, up 19% from 132.83p over the same period.
Filling a typical 55-litre family car tank costs nearly £14 more for petrol and £27 more for diesel since the conflict began on February 28. Diesel drivers alone have paid £676 million extra based on daily consumption and price data.
Oil Price Drop Offers Relief
Global oil prices fell 13% below $100 per barrel to $94.80 (£70.73) following a temporary US-Iran ceasefire. Experts predict pump prices could drop 8p per litre—saving about £4.50 per fill-up—if the truce holds and the Strait of Hormuz stays open.
US President Donald Trump suspended planned strikes on Iran for two weeks, with Tehran agreeing to lift its Strait blockade to resume oil flows during peace talks. Commercial shipping through the Strait has dropped 95% since February 28, tightening supplies and driving up costs. Price changes typically take weeks to reach pumps.
Calls Mount to Delay Fuel Duty Increase
The crisis has generated nearly £170 million in extra VAT for Chancellor Rachel Reeves in just over a month. Critics urge delaying the planned 5p per litre fuel duty hike set for September 1, which would add £3 to a typical fill-up.
Steve Gooding, director of the RAC Foundation, stated: “Drivers continue to pay a huge ‘war premium’ at the pumps, and the Exchequer receives tens of millions from unexpected VAT gains. Even with falling oil prices, it must drop further to pre-conflict levels at $70 per barrel, leaving pain for weeks.”
Edmund King, AA president, added: “The conflict has hurt drivers and hauliers. With the ceasefire, prices could fall 8p per litre soon, but consumers need prolonged support. Delay the September duty rise to ease household budgets, especially over winter.”
Gordon Balmer, head of the Petrol Retailers Association representing 4,500 forecourts, noted: “Falling oil prices benefit motorists, but this is a temporary ceasefire in a volatile market.”
Political Backlash Grows
Tory shadow transport secretary Richard Holden criticized the hike as timing poorly for families amid tax pressures and energy vulnerabilities. He called for scrapping it and boosting North Sea drilling.
Tory shadow transport minister Greg Smith said: “Cars are vital for millions. This political choice ignores other nations cutting duties during crises. Scrap the hikes.”
Reeves and Prime Minister Sir Keir Starmer plan to proceed despite opposition.
