Diesel prices hit record high ahead of budget
RAC calls for lower fuel duty as prices at UK pumps hit a 199.18p average
Remember the self-imposed fuel shortages of 2000, when blockades caused a temporary meltdown of the nation’s refuelling infrastructure? Guess what the average price of diesel - a hot-button issue at the time - was that year? About 81p. On Monday, the RAC told us that it considered the average price of a litre of diesel in the UK to be 199.18p - the ‘highest level in UK history’, eclipsing a record set back in 2022.
Now, clearly there has been a lot of inflation in 26 years, but being on the crest of two pounds per litre does rather boggle the mind. The RAC reckons the cost of filling an ‘average’ family car is almost £110. Which is wince-inducing enough before you consider the cost of brimming a lorry’s tank. “Undoubtedly these increased costs will be passed on to consumers,” said head of policy, Simon Williams, somewhat redundantly.
It’s not like those of us driving something cleaner-burning have anything to cheer, either. "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 [Iran] war – taking the cost of a full tank to nearly £96.” The BBC helpfully points out that the UK is well-equipped to refine petrol (part of the reason its cost remains well shy of the record set in 2022), but cannot produce enough diesel to meet domestic demand.
And because that demand is skewed toward haulage and agriculture, there is no alternative to its use. "These extraordinarily high prices are another reminder of just how exposed the UK is to events occurring far away from its shores,” said Williams. “Only a sustained lower oil price – over several weeks, not days – will lead to cheaper prices at the pumps.”
On the basis that Donald Trump has rejected Iran’s latest proposal to end fighting and reopen the Strait of Hormuz in seven days, lowering the price of Brent crude seems a distant prospect. Over the weekend, this rose to $108 per barrel. Prior to the conflict, it was trading at around $73 per barrel. “By eclipsing the previous highest price of 199.09p seen in June 2022, the diesel price has entered new uncharted territory,” Williams noted.
Despite the UK's ‘limited leverage’ in bringing the war to an end (a polite way of framing the Government’s impotence), the RAC does remind us that it has several levers it might pull in next month’s budget, including lowering fuel duty outright or reducing VAT. Alternatively, if it chooses to do nothing to alter its current plan, by the spring an additional 5p will need to be factored onto prices at the pumps as the current cut is reversed. It seems almost inconceivable that would be allowed to happen. Or not without risking the kind of outrage that shut the refinery gates a quarter of a century ago…
For all who are having to cope with extortionate fuelling charges, worry about interest rate hikes, and general inflation, look no further than the Tangerine Palpatine and consider this: should you be continuing to buy US produce / goods given the impact that said nation has had on your personal finances?
Just a thought. Anyway, Irn Bru kicks the @rse of Coke every day of the week ;-)
There could be a very simple "emergency" measure whereby, as either petrol or diesel hits a given average pump price, the Duty is cut. The revenue's take from the increased VAT more than covers the revenue made from the Duty take that would be cut. It's quick and clean and can be reveresed when (and if) pump prices drop.
It would be a measure that effectively cost the goverment nothing but helps, in a small way, the motoring population.
I'll also place a bet that derv could be £2.30/litre come March unless the moron works out a way to un-f**k the situation.
Back in April I assumed that the War wasn't going to be over quickly and ordered an EV. It has since become primary vehicle and, while it's not free motoring, nor it possible to describe the CLA as fun, it has been saving us a fortune every month... and that very much appeals to my Scottish brain. But we're dragging the caravan to the lake district next month and I'll admit that 15mpg there and back is going to smart a bit so I'm all for an emergency measure to manage our costs.
For all who are having to cope with extortionate fuelling charges, worry about interest rate hikes, and general inflation, look no further than the Tangerine Palpatine and consider this: should you be continuing to buy US produce / goods given the impact that said nation has had on your personal finances?
Just a thought. Anyway, Irn Bru kicks the @rse of Coke every day of the week ;-)
There isn't open rebellion or even protests, if the companies think they aren't pissing people off, I'd assume they'll say their hands are tied and they can't meaningfully drop prices (while posting record profits, of course).
For all who are having to cope with extortionate fuelling charges, worry about interest rate hikes, and general inflation, look no further than the Tangerine Palpatine and consider this: should you be continuing to buy US produce / goods given the impact that said nation has had on your personal finances?
Just a thought. Anyway, Irn Bru kicks the @rse of Coke every day of the week ;-)
Is mass-boycotting the pumps just for one specified day a week a doable but effective way to get big oil and govt to act (it causes huge headaches for them), or did I dream it?
The big difference is refining and supply costs. Europe has closed a lot of refining capacity over the last 15-20 years, environmental requirements are more stringent, fuels are more complex to produce, and operating costs have risen massively. Less capacity + higher costs = bigger refinery margins.
In simple terms, we're not paying much more for the oil itself, we're paying a lot more for everything that happens after it comes out of the ground.
Or to put it another way..... Diesel would need oil to fall from around $100/bbl to around $20/bbl to get back to £1.50/L if refining, distribution, duty and margins stayed where they are today!!
Unless of course, the alternatives will be just as highly taxed in time…
Place your bets - I know where my money will be going…
It’s a fix, but, we are alas powerless to do anything…
Just have to earn more I guess..???
For all who are having to cope with extortionate fuelling charges, worry about interest rate hikes, and general inflation, look no further than the Tangerine Palpatine and consider this: should you be continuing to buy US produce / goods given the impact that said nation has had on your personal finances?
Just a thought. Anyway, Irn Bru kicks the @rse of Coke every day of the week ;-)
In addition to the point you mentioned ($ to £ Exchange rate difference)
-> Wages for everyone in the supply chain in 2026 are higher
-> Rents/leases are much higher
-> Insurance is higher
-> Energy is more expensive
Pointing at a spot price 20 years ago, and thinking the fuel litre price should be no higher today, is walking around with your eyes wide shut !
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