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Prices Zoom up but Fail to return to Normal as Quickly ~ The Cost of Living Crisis Will Only Get Worse!
Petrol and diesel prices rise again as concerns grow over ceasefire
Osmond Chia and Nick Edser, Business reporters
Published
9 April 2026, 02:31 BST
2276 Comments
Updated 3 hours ago
The cost of petrol and diesel has continued to rise as motorists wait to see if the US-Iran ceasefire leads to cheaper prices at the pump.
Oil prices had plunged initially after an agreement to pause the conflict was announced, but rose on Thursday due to concerns over whether the ceasefire would hold.
The price of oil remains much higher than pre-war levels and drivers have been warned not to expect a significant drop in costs soon.
However, one motoring group has said fuel prices could start to fall over the next couple of weeks as long as the ceasefire is maintained.
Doubts over the durability of the US-Iran ceasefire emerged after after Israel launched a wave of strikes on Lebanon.
This led Tehran to warn of a "regret‑inducing response" if they continue, while US President Donald Trump has said the country's forces will remain in the region until Iran complies with the "real" ceasefire agreement.
One of the conditions of the ceasefire agreement was that ships would be able to safely use the Strait of Hormuz - a key shipping route for global oil and gas supplies.
But reports that Iran will keep the crucial shipping route closed because of the Israeli strikes has renewed fears of a lengthy disruption to energy supplies, which would keep fuel prices high.
The price of a barrel of Brent crude rose more than 3.5% to above $98 on Thursday as pressure mounted on what US Vice President JD Vance described as a "fragile truce".
Since the war began on 28 February, wholesale oil prices have jumped by 35%.
Crude oil is a key ingredient in petrol and diesel, so its price has a big influence on the cost of filling up a car.
According to data from UK motoring group the RAC, the average petrol price was 158.03p a litre on Thursday while diesel was 191.11p – both slightly higher than the previous day.
A tank of petrol is now £13.86 more expensive than it was at the beginning of the conflict at £86.92, the RAC said.
A full tank of diesel now costs £26.80 more at £105.11.
The RAC has said drivers should not expect a big fall in pump prices soon, although rival group the AA said wholesale fuel costs were now lower than they were at the start of the week.
"Based on the fuel industry's rule of thumb of a 10 to 14-day lag between wholesale cost movements and those at the pump, drivers should expect prices on forecourts to level by next weekend and then fall – providing the ceasefire holds," said Luke Bosdet, the AA's spokesman on pump prices.
Stock markets reversed some of the major gains they made on Wednesday. Japan's Nikkei 225 index closed down 0.7%, while in Europe the UK's FTSE 100 slipped 0.3%, Germany's Dax index was 1.2% lower and France's Cac was down 0.6%. In the US, the Dow slipped 0.2% in early trade, while the S&P 500 and Nasdaq were roughly flat.
"I think there's a little bit of nervousness in global markets," said Victoria Scholar, head of investment at Interactive Investor.
"Markets are giving back some gains… and I think that reflects a lot of uncertainty over whether the Strait of Hormuz is actually open."
Ships in the Gulf have received a warning from Iran's navy that any vessels seeking to cross the strait without permission "will be targeted and destroyed", shipping brokerage firm SSY has confirmed to BBC Verify.
Iran's deputy foreign minister, Saeed Khatibzadeh, told the BBC that the country would "provide security for safe passage" through the Strait of Hormuz.
However, he said the reopening would only happen "after the United States actually withdraw this aggression", seemingly referring to Israel's attacks on Lebanon.
There is disagreement over whether Lebanon is included in the ceasefire.
Vance is due to take part in negotiations with Iran in Pakistan on Saturday.
Only a handful of ships have passed through the Strait of Hormuz since the deal was announced - well below the rate of some 130 vessels that transited daily before the war.
It will take a minimum of 10 days to clear the existing backlog of vessels, even if the strait resumes its usual volume of shipping, according to maritime tracking firm Pole Star Global.
Shipping through the Strait of Hormuz has been "unchanged in risk profile and numbers transiting" since the announcement of the ceasefire, according to maritime intelligence firm Windward.
The company added that even under a best-case scenario, "weeks are required to move stranded gas and oil cargoes, and months for global trade to approach pre-crisis levels".
In recent weeks, some countries, including Malaysia, India and the Philippines - have negotiated safe passage for its ships.
Nils Haupt from container shipping firm Hapag-Lloyd, which still has six ships in the Persian Gulf, told the BBC's Today programme that it was "very difficult to plan because every day you get very different news".
Haupt said they were still waiting for official information on whether there will be fees to pass through the Strait of Hormuz, but warned that if there were it could have a major impact.
"If this means that for the coming years there will be a fee for the Strait of Hormuz of millions which is double, triple the price of crossing the Panama Canal or the Suez Canal it would be quite ridiculous for the entire industry."
Why fuel and food prices could still be affected for months
ByJemma Crew
Business reporter
Published
8 April 2026
After news broke of a two-week ceasefire in Iran, stock markets across the globe rallied and the price of crude oil plunged.
But there is less optimism over how much this will feed through to people's finances, with fears long-lasting damage has already been set in motion.
The last month has seen ships carrying oil, liquid natural gas and fertiliser effectively blocked from passing through the Strait of Hormuz, while significant damage to facilities in the Gulf has halted production.
Even if the ceasefire holds and a peace deal is reached in time, analysts estimate it will take months to restart production and get supplies back to normal.
No immediate change to rising fuel prices
Despite today's plunging crude oil price, it remains higher than pre-war levels and drivers should not expect a significant drop in costs at the pump soon, says the RAC.
Its head of policy Simon Williams says there is still huge uncertainty for drivers, and their best hope is for pump prices to stop rising in the coming days.
But he says some smaller independent forecourts - which buy oil as it costs on the day rather than in advance at a set price - may be quicker to pass on reductions.
"Much will depend on the stability of the ceasefire, whether oil shipments can move freely through the Strait of Hormuz, and the longer‑term impact on oil production across the Gulf," he says.
He adds a sustained lower price - over several weeks - is needed to meaningfully lower wholesale fuel costs.
Rachel Winter, from the wealth management company Killik & Co, says it is difficult to predict how quickly costs at the pump might fall.
"I would expect it to take at least a few weeks, if not a few months," she told BBC Radio 4's Today Programme.
Meanwhile, jet fuel is roughly double its pre-war levels.
Willie Walsh, the boss of the International Air Transport Association (IATA), says even if traffic through the waterway resumes now, it will take months for supplies to reach the level they need to be at.
Passengers should expect higher ticket prices in the meantime, he says.
Some airlines have already hiked fares, while some have cut routes.
Even if jet fuel were able to flow through the strait, it still needs refining - and some facilities have been damaged, Winter adds.
Alan Gelder, senior vice-president of Refining, Chemicals and Oil Markets for energy analysts Wood Mackenzie, says the whole supply chain needs to return to normal, with ships getting to the right place and refineries resuming operation. That'll take "weeks, not days", he believes.
Will UK petrol and diesel prices start going down?
Published
6 hours ago
Food still expected to become more pricey
A third of the world's fertiliser usually passes through the Strait of Hormuz, and consequently prices have shot up in recent weeks.
It has already become more expensive to transport food across the UK, and for farmers to operate agricultural machinery powered by increasingly expensive diesel, while crop growers who use energy to warm their greenhouses will be facing hikes when the energy price cap resets in July.
The Food and Drink Federation, which represents thousands of UK manufacturers, says the ceasefire hasn't ended the "long‑term uncertainty".
Recovery to supply chains and energy infrastructure in the Gulf is expected to take between six months and a year, says Dr Liliana Danila, its chief economist.
"This means manufacturers will continue to feel the impact of supply chain disruptions for oil, gas, fertiliser, packaging materials and essential cleaning chemicals, keeping costs under strain for months to come."
Even if the conflict ends within the next two weeks, it expects UK food inflation to reach at least 9% before the end of the year.
Wholesale gas prices likely to stay high
So far, households under Ofgem's energy price cap have been shielded from the spike in wholesale energy prices.
The cap resets for three months in July, and we are more than halfway through the window the regulator uses to calculate the new price. Experts have been expecting a big jump at this point.
The government has promised support based on household income, but hinted this might not come until autumn.
Dr Craig Lowrey, principal consultant at Cornwall Insight, says a ceasefire eases some of the immediate pressure on gas markets but "does not wipe the slate clean".
If the strait opens and stays open this will ease prices and be reflected in the July price cap, he says, but adds: "Unless prices fall well below where they were before the conflict, the wholesale price rises seen through March and early April will still feed through to bills."
Lars Jensen from Vespucci Maritime says companies will want reassurances on how vessels can transit safely, and he doesn't believe the two-week pause will be enough to restore trust.
"We should see an increase in exiting vessels," he told Today.
"We will likely also begin to see a trickle of vessels going into the Gulf, but those two will not be of the same magnitude."
Aside from movement through the strait, Lowrey says damage to gas infrastructure in Qatar will take years to rebuild, meaning supply constraints will continue.
"As a result, even with a ceasefire, wholesale gas prices are likely to stay elevated for some time, limiting how far the July price cap can fall."
Osmond Chia and Nick Edser, Business reporters
Published
9 April 2026, 02:31 BST
2276 Comments
Updated 3 hours ago
The cost of petrol and diesel has continued to rise as motorists wait to see if the US-Iran ceasefire leads to cheaper prices at the pump.
Oil prices had plunged initially after an agreement to pause the conflict was announced, but rose on Thursday due to concerns over whether the ceasefire would hold.
The price of oil remains much higher than pre-war levels and drivers have been warned not to expect a significant drop in costs soon.
However, one motoring group has said fuel prices could start to fall over the next couple of weeks as long as the ceasefire is maintained.
Doubts over the durability of the US-Iran ceasefire emerged after after Israel launched a wave of strikes on Lebanon.
This led Tehran to warn of a "regret‑inducing response" if they continue, while US President Donald Trump has said the country's forces will remain in the region until Iran complies with the "real" ceasefire agreement.
One of the conditions of the ceasefire agreement was that ships would be able to safely use the Strait of Hormuz - a key shipping route for global oil and gas supplies.
But reports that Iran will keep the crucial shipping route closed because of the Israeli strikes has renewed fears of a lengthy disruption to energy supplies, which would keep fuel prices high.
The price of a barrel of Brent crude rose more than 3.5% to above $98 on Thursday as pressure mounted on what US Vice President JD Vance described as a "fragile truce".
Since the war began on 28 February, wholesale oil prices have jumped by 35%.
Crude oil is a key ingredient in petrol and diesel, so its price has a big influence on the cost of filling up a car.
According to data from UK motoring group the RAC, the average petrol price was 158.03p a litre on Thursday while diesel was 191.11p – both slightly higher than the previous day.
A tank of petrol is now £13.86 more expensive than it was at the beginning of the conflict at £86.92, the RAC said.
A full tank of diesel now costs £26.80 more at £105.11.
The RAC has said drivers should not expect a big fall in pump prices soon, although rival group the AA said wholesale fuel costs were now lower than they were at the start of the week.
"Based on the fuel industry's rule of thumb of a 10 to 14-day lag between wholesale cost movements and those at the pump, drivers should expect prices on forecourts to level by next weekend and then fall – providing the ceasefire holds," said Luke Bosdet, the AA's spokesman on pump prices.
Stock markets reversed some of the major gains they made on Wednesday. Japan's Nikkei 225 index closed down 0.7%, while in Europe the UK's FTSE 100 slipped 0.3%, Germany's Dax index was 1.2% lower and France's Cac was down 0.6%. In the US, the Dow slipped 0.2% in early trade, while the S&P 500 and Nasdaq were roughly flat.
"I think there's a little bit of nervousness in global markets," said Victoria Scholar, head of investment at Interactive Investor.
"Markets are giving back some gains… and I think that reflects a lot of uncertainty over whether the Strait of Hormuz is actually open."
Ships in the Gulf have received a warning from Iran's navy that any vessels seeking to cross the strait without permission "will be targeted and destroyed", shipping brokerage firm SSY has confirmed to BBC Verify.
Iran's deputy foreign minister, Saeed Khatibzadeh, told the BBC that the country would "provide security for safe passage" through the Strait of Hormuz.
However, he said the reopening would only happen "after the United States actually withdraw this aggression", seemingly referring to Israel's attacks on Lebanon.
There is disagreement over whether Lebanon is included in the ceasefire.
Vance is due to take part in negotiations with Iran in Pakistan on Saturday.
Only a handful of ships have passed through the Strait of Hormuz since the deal was announced - well below the rate of some 130 vessels that transited daily before the war.
It will take a minimum of 10 days to clear the existing backlog of vessels, even if the strait resumes its usual volume of shipping, according to maritime tracking firm Pole Star Global.
Shipping through the Strait of Hormuz has been "unchanged in risk profile and numbers transiting" since the announcement of the ceasefire, according to maritime intelligence firm Windward.
The company added that even under a best-case scenario, "weeks are required to move stranded gas and oil cargoes, and months for global trade to approach pre-crisis levels".
In recent weeks, some countries, including Malaysia, India and the Philippines - have negotiated safe passage for its ships.
Nils Haupt from container shipping firm Hapag-Lloyd, which still has six ships in the Persian Gulf, told the BBC's Today programme that it was "very difficult to plan because every day you get very different news".
Haupt said they were still waiting for official information on whether there will be fees to pass through the Strait of Hormuz, but warned that if there were it could have a major impact.
"If this means that for the coming years there will be a fee for the Strait of Hormuz of millions which is double, triple the price of crossing the Panama Canal or the Suez Canal it would be quite ridiculous for the entire industry."
Why fuel and food prices could still be affected for months
ByJemma Crew
Business reporter
Published
8 April 2026
After news broke of a two-week ceasefire in Iran, stock markets across the globe rallied and the price of crude oil plunged.
But there is less optimism over how much this will feed through to people's finances, with fears long-lasting damage has already been set in motion.
The last month has seen ships carrying oil, liquid natural gas and fertiliser effectively blocked from passing through the Strait of Hormuz, while significant damage to facilities in the Gulf has halted production.
Even if the ceasefire holds and a peace deal is reached in time, analysts estimate it will take months to restart production and get supplies back to normal.
No immediate change to rising fuel prices
Despite today's plunging crude oil price, it remains higher than pre-war levels and drivers should not expect a significant drop in costs at the pump soon, says the RAC.
Its head of policy Simon Williams says there is still huge uncertainty for drivers, and their best hope is for pump prices to stop rising in the coming days.
But he says some smaller independent forecourts - which buy oil as it costs on the day rather than in advance at a set price - may be quicker to pass on reductions.
"Much will depend on the stability of the ceasefire, whether oil shipments can move freely through the Strait of Hormuz, and the longer‑term impact on oil production across the Gulf," he says.
He adds a sustained lower price - over several weeks - is needed to meaningfully lower wholesale fuel costs.
Rachel Winter, from the wealth management company Killik & Co, says it is difficult to predict how quickly costs at the pump might fall.
"I would expect it to take at least a few weeks, if not a few months," she told BBC Radio 4's Today Programme.
Meanwhile, jet fuel is roughly double its pre-war levels.
Willie Walsh, the boss of the International Air Transport Association (IATA), says even if traffic through the waterway resumes now, it will take months for supplies to reach the level they need to be at.
Passengers should expect higher ticket prices in the meantime, he says.
Some airlines have already hiked fares, while some have cut routes.
Even if jet fuel were able to flow through the strait, it still needs refining - and some facilities have been damaged, Winter adds.
Alan Gelder, senior vice-president of Refining, Chemicals and Oil Markets for energy analysts Wood Mackenzie, says the whole supply chain needs to return to normal, with ships getting to the right place and refineries resuming operation. That'll take "weeks, not days", he believes.
Will UK petrol and diesel prices start going down?
Published
6 hours ago
Food still expected to become more pricey
A third of the world's fertiliser usually passes through the Strait of Hormuz, and consequently prices have shot up in recent weeks.
It has already become more expensive to transport food across the UK, and for farmers to operate agricultural machinery powered by increasingly expensive diesel, while crop growers who use energy to warm their greenhouses will be facing hikes when the energy price cap resets in July.
The Food and Drink Federation, which represents thousands of UK manufacturers, says the ceasefire hasn't ended the "long‑term uncertainty".
Recovery to supply chains and energy infrastructure in the Gulf is expected to take between six months and a year, says Dr Liliana Danila, its chief economist.
"This means manufacturers will continue to feel the impact of supply chain disruptions for oil, gas, fertiliser, packaging materials and essential cleaning chemicals, keeping costs under strain for months to come."
Even if the conflict ends within the next two weeks, it expects UK food inflation to reach at least 9% before the end of the year.
Wholesale gas prices likely to stay high
So far, households under Ofgem's energy price cap have been shielded from the spike in wholesale energy prices.
The cap resets for three months in July, and we are more than halfway through the window the regulator uses to calculate the new price. Experts have been expecting a big jump at this point.
The government has promised support based on household income, but hinted this might not come until autumn.
Dr Craig Lowrey, principal consultant at Cornwall Insight, says a ceasefire eases some of the immediate pressure on gas markets but "does not wipe the slate clean".
If the strait opens and stays open this will ease prices and be reflected in the July price cap, he says, but adds: "Unless prices fall well below where they were before the conflict, the wholesale price rises seen through March and early April will still feed through to bills."
Lars Jensen from Vespucci Maritime says companies will want reassurances on how vessels can transit safely, and he doesn't believe the two-week pause will be enough to restore trust.
"We should see an increase in exiting vessels," he told Today.
"We will likely also begin to see a trickle of vessels going into the Gulf, but those two will not be of the same magnitude."
Aside from movement through the strait, Lowrey says damage to gas infrastructure in Qatar will take years to rebuild, meaning supply constraints will continue.
"As a result, even with a ceasefire, wholesale gas prices are likely to stay elevated for some time, limiting how far the July price cap can fall."
Source: https://www.bbc.co.uk/news/articles/c5ywpv1d4geo
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