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UK Diesel Prices Near All-Time High Amid Iran-US Conflict
Confirmed
In Short: The average price of diesel in the UK is close to an all-time high, driven by ongoing conflict between the US and Iran.
The average price of a litre of diesel at the pump stands at 198.32p, according to the RAC motoring body, nearing the all-time high of 199.09p recorded in June 2022.
Simon Williams, head of policy at RAC, said the June 2022 high would "almost certainly be surpassed over the weekend as retailers continue to pass on the increases they're seeing when they buy new supply".
Since the war began, the price of a barrel of Brent crude has been very volatile, with prices falling back to near the $70 a barrel mark in early July after a framework deal was signed.
Diesel prices in the UK are expected to hit record levels over the weekend as the fallout from the US-Israel war with Iran continues to drive up costs.
The Iran war has severely disrupted the production and transportation of wholesale oil across the region, causing the price of fuels made from oil to surge.
Motor fuel prices fell back when the US and Iran agreed to a framework deal to end the fighting, but rose again as tensions resurfaced.
US President Donald Trump has responded to rising diesel prices by mulling a ban on US diesel producers selling overseas, which could push up UK prices even higher.
Crude oil is a key ingredient in petrol and diesel, meaning that higher wholesale costs make filling up a car more expensive.
Analysts say every $10 per barrel increase in the oil price pushes up pump prices by roughly 7p a litre.
US diesel prices are nearly 65 percent higher since the US and Israel struck Iran in February, with the national average around $6.20 a gallon on Sunday.
Trump has blamed Ukraine’s attacks on Russian diesel refineries for creating a diesel shortage, saying it is “hurting the world”.
Combined diesel exports from Russia and the Gulf in August were 1.6 million barrels a day lower than in February, according to the International Energy Agency.
What this adds
Diesel prices in the UK are now averaging 197.31p per litre, according to RAC fuel price analysis.
The price of petrol and diesel is also heavily influenced by demand and refining capacity.
The Iran-US conflict has significantly impacted global diesel prices, with analysts pointing to US military action in the Middle East as the primary cause.
The global diesel shortage is not solely due to Ukrainian attacks on Russian refineries, but rather the broader impact of the Russia-Ukraine war.
What's confirmed
- Before the war began, the average price of petrol was 132.83p per litre and diesel was 142.38p.
What's still developing
- Oil price predicted to remain above $100 for rest of year The UK is heavily reliant on oil and gas imports, with the majority coming from the US and Norway.
- The price of petrol and diesel is also heavily influenced by demand and refining capacity.
- Generally speaking, news of further conflict drives the price up while hopes of an end to the war pushes the price down.
- In addition, US midterm elections are approaching in November, heightening political pressure as rising fuel costs have become a liability for Trump’s Republicans: Diesel prices are now at a record high in the US.
- “There are plenty of other targets,” arguing that the global diesel shortage stems from the Russia-Ukraine war.
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