Diesel Prices Surge Towards Record High Amid Potential Trump Export Ban

The price of diesel is poised to hit a record high today, with experts predicting the £2 per liter barrier could be breached within days. This surge is driven by concerns over dwindling stocks exacerbated by the ongoing Middle East conflict, now in its eighth month.

Adding to the volatility, U.S. President Donald Trump is reportedly considering a 90-day ban on American diesel exports. This potential move is seen as an effort to lower domestic pump prices and bolster support ahead of the November midterm elections. Such a ban would significantly impact the United Kingdom, a net importer of diesel, as the U.S. is its primary supplier.

The average cost of diesel reached 198.89 pence per liter on Saturday, nearing the previous record set in the aftermath of Russia's invasion of Ukraine in 2022. Simon Williams, the RAC's head of policy, stated that the record price "will be broken today."

Drivers have already experienced a substantial increase, with diesel prices jumping by 56.6 pence per liter since February 28, following attacks on Iran by the U.S. and Israel, according to RAC figures. Energy prices have climbed as Iran closed the Strait of Hormuz, a vital waterway for approximately one-fifth of global oil supplies.

This situation is intensifying pressure on the Labour government to postpone a planned 5 pence per liter fuel duty increase scheduled for January. The tax, which generated £24 billion last year, contributes 52.95 pence per liter for both petrol and diesel. Prime Minister Sir Keir Starmer had previously deferred this increase until the end of the year.

Opposition parties are urging Chancellor John Healey to further extend the fuel duty freeze in the upcoming budget to alleviate the cost of living. Shadow Chancellor Andrew Griffith of the Labour party stated, "The Government cannot change everything in the world but it should certainly drop its own plans to raise fuel prices from the end of this year." Robert Jenrick, Reform UK's Treasury spokesman, called a duty increase a "disaster for people's finances and the economy." Conservative energy spokesman Andrew Bowie expressed concern over potential further diesel price hikes, noting their impact on essential sectors like farming, haulage, and tradespeople.

Diesel vehicles constitute nearly one-third of passenger cars on the road in the UK, a figure that rises to 38 percent, or 16 million vehicles, when including lorries, vans, and heavy goods vehicles. Bowie suggested that "Ministers should be fighting for our interests and seeking a carve-out to any ban if necessary," while criticizing Labour's past negotiating record.

Compounding supply concerns, emergency diesel stockpiles have fallen to 42 days' worth. This reduction is partly attributed to refinery closures, including the most recent at Grangemouth in Scotland, which have diminished storage capacity, according to Sky News. Despite these challenges, the government maintains that petrol and diesel are being supplied to forecourts normally. A spokesperson for the Department of Energy Security and Net Zero commented, "We have a diverse and resilient supply. We continue to engage with our international partners and the UK fuel industry."