UK motorists have spent an additional £2 billion on fuel since the surge in pump prices following the Iran conflict. Recent data from the RAC Foundation reveals that drivers have shelled out an extra half a billion pounds on petrol and £1.5 billion on diesel in just over a month.
The average price of petrol stood at 156.98p per liter on Thursday, down from a peak of 158.31p, while diesel was priced at 188.53p per liter, down from 191.54p. Prior to the start of the Iran conflict in early February, petrol was priced at 132.83p per liter, and diesel at 142.38p per liter.
Analysis indicates that the Treasury has received over £336 million in additional VAT due to the price hikes, based on daily pump price increases and last year’s fuel consumption rates.
Steve Gooding, the director of the RAC Foundation, expressed concern over the financial impact on motorists, noting that the effects of the conflict could persist for months even after its conclusion. Diesel vehicle owners have been particularly affected by the price rises, potentially leading to increased costs for commercial users.
The closure of the Strait of Hormuz has triggered a surge in petrol and diesel prices, driven by a sharp increase in crude oil prices. The latest spike saw oil prices surpass $126 (£94) a barrel, the highest level since 2022 during the Russian invasion of Ukraine, with fears of new US strikes on Iran.
As peace talks between the US and Iran falter, there are reports of potential new actions against Iran. President Donald Trump has emphasized that a deal will not be reached until Iran commits to not possessing nuclear weapons.
In addition to higher fuel costs, UK households are expected to face increased energy expenses this summer due to the ongoing conflict. Ofgem is set to announce the next price cap level for July in the coming month.
