UK motorists have been handed the fastest monthly drop in diesel prices since 2000, with the cost plunging by 17p a litre in June, according to motoring group RAC. The dramatic fall follows the US and Iran agreeing a framework deal to end their conflict in June, sending fuel prices into a nosedive.
The war, which began on 28 February when the US and Israel launched strikes against Iran, had severely disrupted energy production and transportation across the Middle East. That pushed the price of Brent crude – the global benchmark for wholesale oil – from about $70 a barrel before the conflict to a peak above $120. Since the framework deal was signed, Brent has dropped back to around $72.
“Diesel prices plunged 17p a litre in June, the fastest monthly fall since 2000, after US-Iran peace deal.”
According to the RAC, the average price of petrol reached an Iran war peak of 159.53p a litre on 28 May, while diesel hit its highest average price of 191.54p a litre on 15 April. Over the month of June, diesel sank from 183.75p a litre to 167.14p, while petrol fell from 159.37p to 151.40p.
Simon Williams, the RAC's head of policy, said: “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.” Before the war, average petrol was 132p a litre and diesel 142p.
Despite the recent falls, the RAC said prices are “still some way off” where they were before the conflict. The AA, another motoring group, said it expects pump prices to fall further, adding that “the timing is perfect for the start of the summer holidays”.
Because transporting oil is a slow process, wholesale price movements take about a fortnight to show at the pump. Fuel retailers have denied accusations of price gouging during the conflict, and the official markets regulator said it had “not seen evidence of retailers actively changing their pricing strategies to take advantage of the crisis”.
Petrol and diesel prices remain below the levels reached in the summer of 2022 following Russia’s invasion of Ukraine, when petrol hit 191.5p a litre and diesel 199p. A government scheme called Fuel Finder lets drivers compare the cost of fuel at different petrol stations across the UK.