Petrol price above 150p a litre for first time in nearly two years

Petrol price above 150p a litre for first time in nearly two years

For the first time since May 2024, the average price of petrol in the UK has exceeded 150p per litre, with diesel prices now surpassing 177p, closely following recent military actions by the US and Israel against Iran.

Recent data from the motoring organization RAC indicates that the ongoing conflict continues to exert upward pressure on fuel prices, although current levels remain below those recorded following Russia's invasion of Ukraine.

On Friday, wholesale oil prices climbed back above $110 per barrel for Brent Crude. This increase comes despite US President Donald Trump announcing a ten-day delay in plans to initiate the destruction of Iranian energy facilities.

The RAC described this latest spike in fuel prices as an "unwelcome milestone." Simon Williams, head of policy at RAC, remarked, "With the long-awaited four-day Easter weekend almost within touching distance, the cost of getting away by car is going to be noticeably higher this year."

Currently, the price of unleaded petrol is 17p per litre higher than it was prior to the conflict, while diesel has increased by 35p per litre.

To assist drivers in managing costs, the RAC advises careful planning regarding refueling, encouraging the use of apps that allow for price comparisons at local stations.

Over the past four weeks, wholesale oil prices have fluctuated between $73 and $116 per barrel for Brent Crude, driven by trader perceptions of whether the outflow of oil from the Middle East would become easier or more constrained.

Late Thursday, President Trump suggested that discussions with Iran were progressing "very well" and indicated that military action against Iran's energy infrastructure would be postponed until at least April 6. Historically, such statements have had a calming effect on the markets.

Nevertheless, Russ Mould, investment director at AJ Bell, commented that the narratives emerging from Washington and Tehran appear to originate from "parallel worlds."

Increases in wholesale prices typically lead to higher consumer prices at the pump, albeit with a slight lag. It is worth noting that a significant portion of the total fuel price consists of transportation, processing, retail, and taxation costs.