The UK government has quietly relaxed its sanctions on Russian crude oil, permitting the import of jet fuel and diesel refined in third countries, amid surging fuel costs exacerbated by the closure of the Strait of Hormuz and ongoing conflict in the Middle East.
New trade licence details
A new trade licence, effective from Wednesday, allows these imports indefinitely. The licence stipulates that the sanctions carve-out will be periodically reviewed as fuel prices continue to rise. This marks a shift from the government's earlier stance, which had blocked Russian oil refined in other nations to further restrict funds flowing to the Kremlin.
Political backlash
Tory leader Kemi Badenoch labelled the move as 'insane'. She posted on X: 'After 18 months of standing up to Putin, the Labour government quietly issued a licence allowing imports of Russian oil refined in third countries. Yesterday Labour MPs voted against UK oil and gas licences. We are now importing from Russia instead of drilling in the North Sea. Insane.'
US Treasury Secretary Scott Bessent extended a 30-day sanctions waiver allowing the purchase of Russian oil shipments already at sea, stating it would help stabilise the physical crude market and ensure oil reaches energy-vulnerable countries.
Petrol prices surge
New figures show petrol prices have eclipsed the previous high set during the Iran oil crisis. The RAC reported that the average price of a litre of petrol at UK forecourts now stands at 158.5p, the most expensive since December 2022. Following the start of the Middle East conflict on February 28, prices had peaked at 158.3p on April 15.
RAC head of policy Simon Williams described the rise as 'bad news for drivers ahead of the bank holiday' and warned prices are set to increase further. He said: 'RAC analysis of wholesale fuel data unfortunately indicates that unleaded is now likely to increase to at least 160p a litre in the coming weeks, unless there is a dramatic and sustained drop in the price of oil, which has been above 100 US dollars a barrel since late April.'
Fuel duty plans
It has been widely reported that Chancellor Rachel Reeves will abandon her plan to increase fuel duty from September. In her November 2025 budget, she announced that the 5p per litre fuel duty reduction, introduced by the Conservative government in March 2022, would be extended until the end of August 2026, with rates then gradually returning to previous levels over the next five years. The Treasury has been contacted for comment.
