Texas · TX Daily News
The average price of diesel has risen above £2 a litre in the UK for the first time, according to the RAC motoring body, as the fallout from the Iran war continues to push up the cost of fuel. Diesel has now hit an average of 200.01p a litre, the RAC said, and petrol prices are also still rising, reaching 174.71p a litre on average. Over the past seven months, the Iran war has severely disrupted the production and transportation of wholesale oil and refined products from the region, causing prices to surge.
The RAC said price rises were "showing no signs of slowing, heaping more misery onto motorists". The cost of filling an average family car with diesel was now £110, almost £32 more than it was at the start of the US/Iran war, the RAC's Simon Williams said. "This will be very challenging for households and companies that drive a lot of miles, from commuters, haulage and delivery firms, businesses with large fleets all the way through to sole traders," he added.
The cost of filling a typical petrol car has risen to £96.09, the RAC said, up £23.03 since February. The jump in fuel costs is the result of a sharp increase in the price of Brent crude, a benchmark for global oil used to make petrol and diesel since the start of the Iran war. The conflict pushed prices higher as it effectively closed the Strait of Hormuz - one of the world's key water transport routes for oil, liquid natural gas and other essential commodities - limiting global supplies.
Before the war began oil was trading at around $73 a barrel, but it peaked at about $120 in April. The price fell back in June when the when the US and Iran agreed to a framework deal to end the fighting, but rose again as tensions resurfaced and is currently at around $100. Flows of crude through the Strait of Hormuz have now returned to prewar levels levels according to the shipping monitoring firm Kpler.
New routes have been established to take crude oil out of the Middle East and the US military presence is supporting exports through the waterway. However, the supply of refined products including diesel remains constrained by the damage caused by the conflicts in Ukraine and Iran. Ukrainian attacks on Russian refineries have reduced that country's output that flows onto the global market.
Diesel is harder to refine than gasoline and so while the UK's four refineries make more than enough petrol to meet demand, they do not make enough diesel for the country's needs. As a result, the UK relies on imports for just under half of the diesel it uses. Of those imports around 31% typically come from the US.
Belgium and the Netherlands jointly supply more than a third.
Source: BBC
