Iran oil crisis has cost UK drivers £307m in higher fuel costs – analysis

The Iran oil crisis has cost UK drivers more than £300 million in more expensive fuel, according to new analysis.

Motoring research charity the RAC Foundation said rises in pump prices since the conflict in the Middle East began on February 28 have led to motorists paying an additional £307 million for petrol and diesel.

Oil prices have soared to as much as 120 dollars a barrel in response to Iran’s stranglehold on tankers passing through the Strait of Hormuz.

This has led to the average price of a litre of petrol at UK forecourts rising from 132.9p on February 27 to 146.4p on Monday.

Diesel prices have surged from 142.4p to 169.8p over the same period.

The RAC Foundation took into account average daily pump prices and fuel consumption rates to calculate that UK drivers have spent an estimated £4.574 billion on petrol and diesel since February 28.

Its analysis found this figure would have been £4.267 billion if pump prices had remained broadly stable.

The charity described the £307 million difference as a “direct cost” of the war.

It warned the figure would continue to rise “even if the conflict was resolved tomorrow” because of the time lag between changes in the barrel price of oil and pump prices, plus the time it will take to repair war damage to oil production, refining and distribution infrastructure.

Steve Gooding, director of the RAC Foundation, said: “This puts a financial price on the war not just for UK drivers but also the nation’s businesses.

“Whether you are running a household or a company, fuel prices make up a significant part of the budget.

“Even those who don’t drive will be impacted by higher transport costs as firms pass on their additional costs to their customers.

“All of which is adding to the cost-of-living crisis.

“In the short term, people have little option to change the way they live and so they are stuck with footing the refuelling bill despite the increase in cost.”

There are growing calls for the Government to postpone an increase in fuel duty planned for September because of the rise in pump prices.

Chancellor Rachel Reeves announced in her November 2025 budget that the 5p-per-litre cut in fuel duty introduced by the Conservative government in March 2022 would only be extended until the end of August 2026, with rates then gradually returning to March 2022 levels over the next five years.

On Tuesday, energy minister Michael Shanks insisted motorists should not drive slower nor buy fuel differently because of the conflict.

Asked by Times Radio if British drivers should change their habits, he replied: “They should do everything as absolutely normal because there is no shortage of fuel anywhere in the country at the moment.

“We monitor this every single day, I look at the numbers personally. There’s no issue at all with that.”

The International Energy Agency has advised motorists across the world to reduce their speed on highways, share rides and work from home when possible to reduce how much petrol or diesel they use.

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