Price of diesel on UK forecourts reaches all-time high

The price of diesel on UK forecourts has hit an all-time high average of 199.18p a litre, as the conflict in the Middle East continues to drive the cost of fuel to record levels.

The price, which previously peaked at 199.09p in June 2022 after Russia’s invasion of Ukraine, could soon top the £2 mark after Donald Trump rejected Iran’s proposal for a seven-day peace deal to reopen the critical oil and gas shipping route through the strait of Hormuz.

The RAC estimates that the cost of filling an average family car with diesel is now almost £110, £31 more than it was at the start of the US-Iran conflict in February.

“The diesel price has entered new uncharted territory,” said Simon Williams, the head of policy at the motoring organisation.

“This spells pain not only at the pumps for drivers, but for everyone who buys goods or services that rely on diesel lorries and vans. Undoubtedly, these increased costs will be passed on to consumers.”

The price of petrol is also continuing to rise, with the average price of a litre hitting 174.13p on average, 41p more than at the start of the war. The cost of filling a full tank is nearly £96, according to the RAC.

Trump has said he is “very seriously” considering a US diesel export ban to try to curb soaring prices, and has urged Ukraine’s president, Volodymyr Zelenskyy, to pause strikes on Russian oil refineries over concerns that they could further push up prices.

“The consequences [of soaring fuel prices] could reach almost every part of UK economic life: supermarkets, manufacturing, construction, agriculture, e-commerce and countless other sectors that depend upon road freight,” said Dr Jonathan Owens, an operations and supply chain expert at the University of Salford.

“So, a geopolitical event and potential policy decision thousands of miles away can travel rapidly through our supply chain: from a refinery to a tanker, to a UK haulier, to a distribution centre, to a supermarket shelf and ultimately, the price will be paid by the consumer.”

The RAC urged the government, which has extended the 5p cut in fuel duty until the end of the year, to consider expanding the discount or reducing VAT to help motorists at the pump.

“As things stand another 5p a litre will be loaded on to pump prices by the spring if the current fuel duty cut is fully reversed as planned,” said Williams. “VAT receipts from fuel are also extremely high.”