British motorists are bracing for record-breaking fuel costs as average diesel prices approach the significant £2-per-litre threshold. Across the country, the average price of diesel has jumped 54% to 196.28p a litre since the onset of the Middle East crisis in late February. While some forecourts have already exceeded the £2 mark, experts anticipate this will become the nationwide standard within days.
The current energy crisis is being driven by a convergence of global supply chain disruptions. Geopolitical instability, particularly the US-Israel conflict with Iran and the ongoing war in Ukraine, has wiped out approximately one-fifth of global diesel supplies. A critical factor is the damage to refining infrastructure; Ukraine’s recent air strikes on the Kapotnya oil refinery near Moscow represent a significant escalation. According to the International Energy Agency, output from Russia’s war-damaged refineries has declined by nearly a third over the last year, hitting a 20-year low.
Donald Trump has engaged in the debate, urging Ukrainian President Volodymyr Zelenskyy to halt strikes on Russian energy infrastructure. In a statement on Truth Social, the former president claimed Russia has “unfortunately lost control of its Diesel Oil Industry” and called for an end to “this ridiculous and never ending war.”
The crisis is being compounded by a structural shift in UK refining capacity. Since the turn of the century, the number of refineries operating in the UK has plummeted from nine to four. Consequently, reliance on diesel imports has soared from 14% in the early 2000s to 54% last year, as detailed by Fuels Industry UK. Elizabeth de Jong, chief executive of the industry body, noted that while domestic demand for petroleum products rose 1% in 2025 to nearly 61 million tonnes, the closure of key facilities like Grangemouth and Lindsey has deepened dependence on overseas markets, which currently account for about 55% of the UK’s road diesel supply.
For small businesses and independent traders, the soaring costs are becoming unsustainable. Jon Barden, a former humanitarian adviser now working as a handyman, reports that his fuel expenses have doubled, noting that half of his daily earnings now go toward filling up his van for jobs around Tottenham. “I’ve had to put my prices up,” Barden explains, acknowledging that rising fuel costs trigger broader inflationary pressure on the materials he needs to purchase from retailers like Wickes.
The ripple effect extends to the logistics sector. Richard Smith, managing director of the Road Haulage Association, warned that because nearly all supermarket goods are transported by lorry, the spike in diesel costs is inevitably being passed on to the consumer at the checkout. Although Brent crude prices briefly dipped below $100 a barrel on Monday, the market remains volatile, and the “crack spread”—the price difference between crude and refined products—has surged past $100 a barrel in Europe.
This is further exacerbated by the situation in the Strait of Hormuz, where Iran’s effective blockade has driven Brent crude to a four-year high. Additionally, China, the world’s largest refiner and a major importer of Iranian crude, has capped its own exports of refined products since March to preserve domestic reserves, further tightening global supply.
The AA has highlighted the vulnerability of rural communities and vehicle-reliant services. “They don’t get to add diesel surcharges to invoices, like many of the big companies, for fear of losing customers,” said spokesperson Luke Bosdet. Mehmet, a veteran black cab driver in London for 35 years, recalled that diesel was once just 10 pence per gallon—a stark contrast to the modern reality where costs are pushing the sector to a breaking point.
Despite a long-term shift toward electric and hybrid vehicles, diesel remains the primary fuel for industrial and commercial transport. With limited capacity to increase refining throughput, experts warn that the current supply crunch will continue to place downward pressure on economic activity as transport costs permeate every sector of the economy. The report also notes that more than 1,500 miles away, British motorists are braced for the ripple effect from that conflict, and the US-Israel war on Iran. The report also notes that already hard-pressed households and small firms face a far greater cost threat at forecourt pumps as the combined impact of Russia’s war-damaged refineries and the Middle East crisis has erased about a fifth of the world’s diesel supplies, while the price of Brent crude oil – which briefly fell below $100 a barel on Monday – remains in flux. The report also notes that once used for camping trips, is now used to carry heavy tools to jobs around Tottenham in north London, his diesel Ford estate. The report also notes that with some forecourts already charging above the psychologically important mark, it is expected to reach a record £2 a litre within days. The report also notes that in Europe, pump prices have already hit record highs in recent weeks, leading to unrest and growing calls for government leaders to protect consumers from the surge in cost. The report also notes that diesel remains the overwhelmingly dominant fuel, while the popularity of fully electric and hybrid petrol vehicles may be on the rise in the UK and Europe amid attempts to move away from polluting fossil fuels.
Comments