UK motorists have been handed the fastest monthly fall in diesel prices since 2000, with the cost plunging by 17p a litre in June as the US-Israel war with Iran draws to a close.
According to the motoring group RAC, the average price of diesel sank from 183.75p a litre to 167.14p a litre over the month, while petrol dropped from 159.37p to 151.40p. The dramatic reversal follows months of surging fuel prices after the conflict erupted on 28 February, severely disrupting Middle East energy production and transport.
“Diesel fell 17p a litre in June, the biggest monthly drop since 2000, as Iran war fears eased.”
Since the US and Iran agreed a framework deal to end the fighting in June, prices have nosedived. A barrel of Brent crude – the global benchmark – peaked above $120 during the war but has since fallen back to around $72, close to its pre-conflict level of about $70.
Yet the RAC warned that pump prices remain far from where they were before the war began, when petrol averaged 132p a litre and diesel 142p. “As things stand, petrol should dip under 150p soon and diesel ought to get to below 160p, but we would need the price of oil to fall further to see a return to the pre-conflict prices,” said Simon Williams, the RAC’s head of policy.
The AA, another motoring group, said it expects further price falls. “The timing is perfect for the start of the summer holidays,” a spokesperson added.
Transporting oil is a slow process, meaning wholesale market movements take about a fortnight to reach the pump. During the war, petrol peaked at an average of 159.53p a litre on 28 May, while diesel hit 191.54p on 15 April. Despite the conflict, prices still remain below the summer of 2022, when petrol reached 191.5p and diesel 199p following Russia’s invasion of Ukraine.
Fuel retailers have denied accusations of price gouging during the crisis, and the official markets regulator said it had “not seen evidence of retailers actively changing their pricing strategies to take advantage of the crisis.” Meanwhile, a government scheme called Fuel Finder allows drivers to compare pump prices across the UK.