The AA has reported that the average cost of a litre of petrol has risen to 151.0p, up from 150.7p a week ago. Diesel prices have also increased slightly, standing at 164.9p per litre, a 0.1p uptick over the same period. This marks the end of a brief period of lower prices and signals a new upward trend just as the summer holiday season begins.
Why Are Fuel Prices Increasing?
The rise in pump prices is driven by an increase in wholesale fuel costs, which are largely influenced by oil prices. Since late June, oil prices have climbed due to renewed hostilities between Iran and the US, which have restricted the movement of tankers through the Strait of Hormuz, a crucial chokepoint for global oil shipments.
Luke Bosdet, the AA’s spokesman on pump prices, warned: "Despite more than a penny coming off the average price of petrol over the past fortnight, drivers across the UK now face new increases heading towards the start of the summer holidays."
Impact on Summer Travel
RAC head of policy Simon Williams cautioned that recent pump price savings "could start to disappear." He said: "Drivers embarking on their summer getaways may well see slightly higher forecourt prices again, with both petrol and diesel likely to go up a couple of pence a litre more in the next week or so. The fate of pump prices here in the UK once again rests on whether there are further attacks between the US and Iran."
Between Friday 17 July and Sunday 19 July, an estimated 14.1 million drivers are expected to hit the road for summer staycations, compared to 18.8 million in 2022. The RAC has warned of a 'Saturday summer scramble', with the largest number of journeys on a single day (3.8 million) set to take place on Saturday 18 July. Both Friday and Sunday are expected to see around 3.4 million individual trips each.
Historical Context and Future Outlook
The conflict earlier this year sent pump prices spiralling, with drivers paying more than 180p per litre for diesel and 160p for petrol at the peak of the crisis. After a temporary peace deal and the reopening of the Strait of Hormuz, oil prices returned to pre-war levels in June. However, recent Iranian strikes on ships passing through the Strait have prompted retaliatory attacks by the US, raising fears of a full resumption of the war.
Benchmark Brent crude rose 4% to 79 US dollars a barrel amid confusion over control of the Strait of Hormuz, with both America and Iran claiming control. This uncertainty is expected to push petrol prices higher once again, just ahead of the school summer holidays, putting additional financial pressure on motorists.
