Petrol prices have surged to record highs following the Iran conflict, prompting warnings from the RAC about potential further increases in the near future.
Currently, the average cost of unleaded petrol stands at 158.52p per litre, surpassing the previous peak of 158.31p per litre recorded on April 15. After a slight decrease in early May, petrol prices began climbing again.
The spike in prices can be attributed to the significant rise in Brent crude oil prices since the onset of the Middle East conflict in late February. This surge in oil prices has directly impacted the escalating costs of both petrol and diesel.
The RAC anticipates that the price of unleaded petrol could climb to at least 160p per litre unless there is a substantial and sustained decline in oil prices. As of Tuesday, Brent crude was priced at approximately $110 per barrel.
RAC’s head of policy, Simon Williams, expressed concern, stating that analysis of wholesale fuel data indicates an inevitable increase in unleaded petrol prices to 160p per litre in the upcoming weeks unless there is a substantial drop in oil prices, which have remained above $100 per barrel since late April.
While the average diesel price has notably decreased since its peak in early April, currently resting at 185.92p per litre, the RAC emphasized that these prices should ideally be lower. The organization urged retailers to pass on the savings they are benefiting from to consumers at the pump.
A recent investigation by the Competition and Markets Authority revealed that the surge in fuel prices primarily stems from the elevated cost of oil rather than retailers inflating margins. The CMA noted that the price differential between what retailers pay for fuel and the price at which they sell it has remained relatively stable since the conflict began.
However, the CMA identified increased fuel margins for a minority of retailers in March and pledged to further investigate these discrepancies.
Sarah Cardell, CEO of the CMA, highlighted the impact of the Middle East conflict on fuel prices, stressing the importance of monitoring to ensure that any cost reductions are promptly passed on to consumers. The CMA remains committed to overseeing the market and ensuring fair practices to benefit motorists across the UK.