Diesel prices in the UK have hit a new all-time high, surpassing the previous record set in the wake of Russia’s invasion of Ukraine in 2022. The average price of a litre of diesel stood at 199.18p on Monday, according to figures compiled by the RAC.
This is 56.8p more expensive than at the start of the US-Iran war on February 28 this year, when a litre averaged 142.38p. The previous record high was 199.09p, reached in June 2022.
Supply disruptions drive up costs
The cost of diesel has risen steadily in recent weeks due to the impact on global supplies from the ongoing conflict between Russia and Ukraine and from renewed hostilities in the Middle East. Russian exports of diesel have dropped sharply after many of the country’s oil refineries were targeted by Ukraine, with a key facility near Moscow damaged earlier this month as part of a huge drone operation.
This has led to extra demand for fuel from other diesel-exporting countries, causing wholesale prices to rise. Meanwhile, the ongoing war between the US and Iran is continuing to disrupt the global trade in refined oil and other petroleum materials, with Iran’s effective blockade of the Strait of Hormuz limiting the production and supply of fuel needed by consumers.
RAC warning on household costs
The RAC data is based on the average price of diesel at a range of supermarkets, motorway service stations and independent retailers. The cost of unleaded petrol has also been climbing in recent weeks and currently stands at an average of 174.13p per litre, up by 41.3p since the start of the US-Iran war.
RAC head of policy Simon Williams said: "The average price of a litre of diesel has now reached the highest level in UK history at 199.18p, in what will be a financial blow to households and businesses that use their vehicles regularly. The cost of filling up an average family car is now almost £110, £31 more than it was at the start of the US/Iran conflict.
"By eclipsing the previous highest price of 199.09p seen in June 2022, the diesel price has entered new uncharted territory. 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.
Petrol prices, too, are continuing to rise. A litre of unleaded stands at 174.13p on average, 41p more than at the start of the war – taking the cost of a full tank to nearly £96."
Pressure on Government
Mr Williams continued: "These extraordinarily high prices are another reminder of just how exposed the UK is to events occurring far away from its shores. Only a sustained lower oil price – over several weeks, not days – will lead to cheaper prices at the pumps. Suggestions of a renewed deal to end the blockade of the Strait of Hormuz and get oil supplies moving freely again had offered a slight glimmer of hope for drivers.
"The UK might have limited leverage when it comes to ending the US/Iran war and ultimately bringing oil prices down, but the Government could take steps to ease the burden on drivers by lowering fuel duty further or reducing VAT. As things stand, another 5p a litre will be loaded onto pump prices by the Spring if the current fuel duty cut is fully reversed as planned. VAT receipts from fuel are also extremely high, so drivers will be watching this coming week's Labour party conference, and October's Budget, very carefully indeed."
A total of 15.1 million diesel-fuelled vehicles were licensed to be on UK roads at the end of June this year, down from 15.7 million 12 months earlier, according to the latest figures from the Department for Transport. There were 9.8 million diesel cars, down year on year from 10.4 million. Some 20.4 million petrol vehicles were licensed to be on roads this June, including 18.8 million cars.
