UK Diesel Prices Top £2 a Litre for First Time, RAC Says

The average price of diesel in the UK climbed above £2 a litre for the first time, reaching 200.01p, the RAC motoring group said Friday, according to the BBC. Petrol also kept rising, averaging 174.71p a litre, the RAC said.

RAC policy head Simon Williams called £2 "a price threshold no one wanted to cross," adding the increase "will be very challenging for households and companies that drive a lot of miles, from commuters, haulage and delivery firms, businesses with large fleets all the way through to sole traders."

Why are diesel and petrol prices rising in the UK?

The increases trace back to disruption in global oil markets. Over the past seven months, the Iran war has disrupted production and transport of wholesale oil and refined products from the region, driving prices higher worldwide, the BBC reported. Ukrainian attacks on Russian refiners have further constrained diesel supplies on the world market, and China has restricted exports of refined fuels, adding to the squeeze.

The RAC said price rises are "showing no signs of slowing, heaping more misery onto motorists."

What did the G7 agree to do about it?

G7 nations held an urgent meeting Friday and agreed to release 100 million barrels of oil in an effort to head off further price increases, according to the BBC. Member countries also agreed not to impose export restrictions on each other's fuel shipments.

That pledge followed a threat from US President Donald Trump to ban shipments of American diesel overseas, a move that would have pushed up global diesel prices while easing pressure on US consumers ahead of November's midterm elections. Over half of the diesel bought in the UK is imported, and less than a third of those imports come from the US — about 17% of total UK supply, the BBC reported.

How is the UK government responding?

UK government ministers sought to reassure diesel users Friday. "We have a diverse and resilient supply. We continue to engage with our international partners and the UK fuel industry," a government spokesperson told the BBC. The government stressed there is no cause for concern about potential diesel shortages.

The pump-price surge comes as other UK economic indicators have also moved sharply. Thirty-year UK government bond yields topped 6% this week for the first time since 1998, HTT News reported, underscoring broader pressure on household and business costs even as the fuel and borrowing pressures stem from separate causes.

Who is feeling the impact most?

The BBC spoke with businesses and workers already adjusting to the higher costs. Norfolk farmer Mark Means, who has farmed for more than 50 years, said he was "frightened to death" by rising diesel costs and had spent £50,000 on new diesel tanks to secure enough fuel supply for harvesting and planting, even as the higher price erodes his margins. "It feels like it's an assault," he said.

Steven Tompkins, a driving instructor in Leicester, said rising fuel prices are forcing instructors to raise their rates. "When you've got kids who are working part time, they're on a tight budget and we're telling them that the prices are going to have to go up because of the fuel, it's hurting," he said.

The BBC noted that even drivers without diesel vehicles face knock-on effects through higher delivery costs and increased food production expenses tied to fuel.

What to watch

• Whether the G7's 100-million-barrel release slows the rise in UK pump prices in coming weeks.
• Whether Washington follows through on, or abandons, any diesel export restrictions ahead of the November US midterms.
• Further disruption to Russian refining capacity from Ukrainian strikes, which could tighten diesel supply further.
• UK government statements on fuel-supply resilience if pump prices continue climbing.

Glossary

RAC: A UK motoring organization that tracks and publishes average national fuel prices.

G7: A grouping of seven major economies — the US, UK, Canada, France, Germany, Italy and Japan — that coordinates on economic and security matters.

Refined fuel export restrictions: Government limits on shipping processed fuels like diesel and petrol abroad, often used to keep domestic supply high and prices lower at home.