UK petrol prices have risen to their highest level since the beginning of the Iran war as the conflict continues to hit drivers' finances. The average cost of petrol has reached more than 160p per litre, according to motoring group the RAC. The price of fuel tends to track the wholesale price of oil, which surged when the Iran conflict began on 28 February.
The fighting has severely disrupted oil supplies across the Middle East. Prices then nosedived when US and Iran agreed to a framework deal to end the conflict in June, but they have risen again since the collapse of peace talks. Crude oil is a key ingredient in petrol and diesel, which means that higher wholesale costs make filling up a car more expensive.
Analysts say every $10 (£7.44) per barrel increase in the oil price pushes up pump prices by roughly 7p a litre. Since the war began, the price of a barrel of Brent crude – the global benchmark for wholesale oil prices – has been very volatile. Generally speaking, news of further conflict drives the price up while hopes of an end to the war pushes the price down.
Before the conflict, Brent was about $70 a barrel, but the fighting saw it peak at above $120. In early July, after the framework deal was signed, prices fell back to near the $70 a barrel mark. When the peace talks collapsed, the price climbed back up again to above $100 a barrel, but are now around $80.
While petrol has hit its highest price since the Iran war began, according to the RAC, diesel remains below the peak of 191.54p a litre it reached on 15 April. In early July, the RAC said the average price of petrol sank to a low of 150.59p per litre and 164.52p per litre for diesel. Since then the prices have risen, with petrol now at 161.5p a litre while diesel costs 181.5p a litre.
RAC's head of policy Simon Williams said the price of fully filling a diesel family car was now £100 again, "something drivers haven't had to endure since early June". Williams said there was hope that prices at the pump could come back down, pending talks to re-open the Strait of Hormuz. Despite the conflict, petrol and diesel prices remain below the levels reached in the summer of 2022 following Russia's invasion of Ukraine, when petrol reached 191.5p a litre and diesel hit 199p.
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