Why are petrol and diesel fuel prices on the rise again?
- Perry Richardson
- 8 minutes ago
- 2 min read
Petrol and diesel prices have risen after three months of decline, with average costs jumping in June due to instability in the Middle East, according to new data from RAC Fuel Watch.
Unleaded petrol increased by 2p a litre to an average of 134.17p, raising the cost of filling a typical 55-litre car to £73.79. Diesel climbed nearly 3p, from 138.39p to 141.21p per litre, pushing up the cost of a tank by £1.55.
Supermarket fuel remained slightly cheaper, with smaller increases. Petrol rose 1.3p to 130.26p, while diesel moved up by 1.6p to 136.67p. Northern Ireland continues to offer the lowest average prices in the UK, with petrol at 128p and diesel at 134p.
The main factor behind the rise was a sharp increase in global oil prices, which jumped from around $64 a barrel in late May to almost $79 by 19 June. This followed heightened tensions between Israel and Iran, leading to concerns over potential disruption to oil flows through the Strait of Hormuz. Although oil prices dropped again to $67 by the end of the month, they remain slightly higher than at the start of June.
The RAC is now watching to see if forecourt prices follow the fall in wholesale oil costs. Much will depend on how much profit retailers choose to make. The Competition and Markets Authority (CMA) this week repeated concerns about weak competition and high margins in the fuel retail sector, which can prevent wholesale price drops from being passed on to drivers.
RAC fuel spokesperson Simon Williams said the early summer rise was unwelcome, but there’s currently no reason for further increases. He added that July will be key in showing whether retailers choose to pass on cost savings or maintain current prices.
Despite the recent uptick, fuel remains well below the record highs of 2022, when prices surged past £2 a litre following Russia’s invasion of Ukraine.
