Why have UK fuel prices gone up so much?

UK fuel prices have risen significantly due to the Middle East conflict, which began on February 28, 2026, causing Brent crude oil to trade around 110 US dollars per barrel, up from under 70 US dollars. Motor fuels were identified as the main driver for the March 2026 CPI inflation increase to 3.3%.

When does the 5p fuel duty cut end?

The temporary 5 pence per litre fuel duty cut, introduced in March 2022, is scheduled to expire on August 31, 2026. After this date, fuel duty is planned to gradually increase back to its pre-2022 levels by March 2027.

How much of the pump price is tax?

A substantial portion of the pump price is tax. For a petrol price of 157p per litre, roughly 74p is tax, consisting of 52.95p duty plus approximately 26p VAT. For a diesel price of 190p per litre, around 84p is tax, made up of 52.95p duty and roughly 32p VAT.

UK Petrol And Diesel Prices April 2026: Diesel Up 33p Since Iran War, Pump Average Hits 190p

UK motorists checking petrol prices in April 2026 will find the average unleaded petrol stands at 157.47 pence per litre as of April 21, according to RAC Fuel Watch and heycar weekly price updates. Diesel drivers face significantly higher costs, with the average diesel price hitting 190.13 pence per litre on the same date. This marks a substantial increase in diesel pump prices, which have risen by 33.4 pence per litre since the Middle East conflict, often referred to as the Iran War, began on February 28, 2026.

The Surge in Diesel Prices and the Iran War Impact

The recent escalation in diesel prices is directly linked to the Middle East conflict. Since the conflict's inception, Brent crude oil, a key global benchmark, has consistently traded around 110 US dollars per barrel. This represents a significant jump from under 70 US dollars per barrel observed before the conflict commenced. The higher cost of crude oil naturally translates into increased prices at the pump for refined fuels.

This upward trend in fuel costs has not gone unnoticed in the broader economy. The Office for National Statistics reported that UK CPI inflation rose to 3.3% in March 2026, up from 3.0% in February. Motor fuels were specifically identified as the primary driver behind this monthly inflation increase, highlighting the widespread economic effect of rising pump prices.

The Financial Burden on UK Drivers

For the average UK motorist, who drives approximately 7,400 miles per year and uses about 1,200 litres of fuel annually (a mix of petrol and diesel), these price hikes translate into real financial strain. The 33 pence per litre rise in diesel prices since late February 2026 means that a typical diesel driver can expect to pay approximately 400 pounds more per year in fuel costs. This additional expenditure impacts household budgets across the country, affecting everything from daily commutes to business operations.

Understanding Fuel Duty and VAT

A significant portion of the price paid at the pump consists of taxes. Currently, UK fuel duty is set at 52.95 pence per litre for both petrol and diesel. This figure includes a temporary 5 pence per litre cut that was initially introduced in March 2022 and has since been extended multiple times.

In addition to fuel duty, Value Added Tax (VAT) is charged at 20% on the total pump price, which means VAT is applied even to the fuel duty component. This layered taxation structure means a substantial portion of what drivers pay is collected by the government. For a petrol price of 157 pence per litre, roughly 74 pence is attributed to tax, comprising the 52.95 pence duty plus approximately 26 pence in VAT. Similarly, for a diesel price of 190 pence per litre, around 84 pence is tax, made up of the 52.95 pence duty and roughly 32 pence in VAT.

The Future of Fuel Duty: Expiry of the 5p Cut

Motorists should be aware that the current 5 pence fuel duty cut is not permanent. It is scheduled to expire on August 31, 2026. Following this date, fuel duty is planned to gradually rise back to its pre-2022 levels by March 2027. This impending increase, coupled with the current elevated crude oil prices, suggests that pump prices could face further upward pressure in the coming months, even if global oil markets stabilize.

Strategies for Saving Money at the Pump

With prices at current levels, finding ways to save on fuel has become a priority for many UK drivers. Here are some strategies based on observed pricing trends:

Choose Supermarket Forecourts: Supermarket stations, such as Tesco, Sainsbury's, Asda, and Morrisons, typically offer fuel prices that are 4 to 8 pence per litre lower than those at branded stations.
Avoid Motorway Service Stations: Convenience often comes at a premium. Motorway service station prices can be 15 to 25 pence per litre higher compared to supermarket equivalents, making them a costly option for refuelling.
Utilise Price Comparison Apps: Tools like PetrolPrices UK and Waze Fuel can be invaluable. These apps help drivers locate the cheapest station within a five-mile radius, allowing for informed choices that can lead to significant savings over time.

As UK motorists navigate the elevated fuel price landscape of April 2026, understanding the underlying factors, the tax components, and effective money-saving strategies remains crucial. The ongoing geopolitical situation, coupled with scheduled changes in fuel duty, will likely keep fuel prices a prominent concern for the foreseeable future.

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