UK diesel prices have hit a record high of more than £1.80 per litre amid efforts to reduce dependence on Russian fuel. According to figures from the RAC’s Fuel Watch initiative, the average litre of diesel now cost UK motorists 180.29p on May 15, topping the 179.9p record set on March 23 this year.
The news comes amid attempts to reduce use of Russian diesel in light of the ongoing war in Ukraine. With companies avoiding the Russian fuel, the supply has tightened and caused an increase in the wholesale price – the amount retailers pay for diesel before selling it on to consumers.
Although the wholesale price has fallen slightly of late, the European Union is pondering an outright ban on Russian diesel, which the RAC claims is likely to ensure such a reduction is only temporary. As a result, the motoring organisation says drivers should “brace themselves” for yet more pain at the pumps if wholesale prices do indeed rise.
So far, the RAC says fuel prices have risen noticeably since the start of May, with petrol prices up by almost 3p per litre, taking the average price to 166.65p per litre. Meanwhile the current average price of diesel is also 3p per litre higher than it was at the end of April.
These increases come despite the slight reduction in fuel prices seen in April, and since the Chancellor, Rishi Sunak, announced a 5p-per-litre cut in fuel duty. The RAC has said Sunak’s decision not to reduce VAT by five percent means drivers of diesel vehicles are 2p per litre worse off than they would have been with a 15-percent VAT rate.
“Sadly, despite the Chancellor’s 5p a litre duty cut the average price of a litre of diesel has hit a new record high at 180.29p,” said RAC fuel spokesperson Simon Williams. “Efforts to move away from importing Russian diesel have led to a tightening of supply and pushed up the price retailers pay for diesel. While the wholesale price has eased in the last few days this is likely to be temporary, especially if the EU agrees to ban imports of Russian oil.
“Unfortunately, drivers with diesel vehicles need to brace themselves for yet more pain at the pumps. Had Mr Sunak reduced VAT to 15 percent as we called on him to do instead of cutting duty by 5p, drivers of diesel vehicles would be around 2p a litre better off, or £1 for every full tank. As it is, drivers are still paying 27p VAT on petrol and 29p on diesel, which is just the same as before the Spring Statement.
“The average price of petrol is also on the rise, having gone up nearly 3p a litre since the start of the month to 166.65p, which means it’s less than a penny away from the all-time high of 167.30p set on 22 March.”