Petrol and diesel prices across the UK could climb significantly in the coming weeks as tensions in the Middle East increase. There are growing concerns that Iran may respond to recent military action by disrupting global oil supply.
On Sunday, June 22, Iran announced it would close the Strait of Hormuz in retaliation for airstrikes by the United States and Israel on its nuclear facilities. The Strait is one of the world’s most important oil trade routes. According to the US Energy Information Administration, around 20 million barrels of oil pass through the strait each day — roughly 20% of the world’s oil supply.
Experts warn that closing the strait would have a serious impact on global oil prices. Although shipping through the area hasn’t been significantly disrupted yet, the situation has already pushed prices higher.
Brent crude oil rose from $69 (£51.35) per barrel on June 12 to $74 (£55.07) per barrel on June 13. Some analysts, including Jim Reid from Deutsche Bank, say prices could hit $120 (£89.32) if Iran follows through on its threats. He said markets are preparing for various outcomes depending on whether Iran "weaponises oil."
Brent crude has been highly volatile over the past five years. Prices dropped to around $40 (£29.77) per barrel during the early stages of the COVID-19 pandemic, but spiked to $123 (£91.54) after Russia invaded Ukraine in February 2022. This led to UK fuel prices reaching record highs — with petrol averaging 191p per litre and diesel nearly £2 by July 2022.
Currently, according to RAC Fuel Watch, petrol is averaging 132.06p per litre, and diesel is at 138.19p. The RAC is not currently predicting immediate price changes, despite months of declining costs. But if the Strait of Hormuz is closed, the price of oil could quickly surge again, taking fuel prices with it.
Energy analyst Saul Kavonic of MST Marquee said: “It all depends on how Iran reacts in the short term. If they follow through with threats, oil could reach $100 (£74.46) per barrel or more.”
Meanwhile, US Secretary of State Marco Rubio has urged China to help prevent Iran from shutting the strait, calling it “economic suicide” that would damage global markets. He warned that the US and others have options to respond, but that many countries would suffer more than America if the route is blocked.
The rising tensions follow a US-led military operation named Midnight Hammer, which used 125 aircraft — including advanced B-2 stealth bombers — to strike nuclear sites in Fordo, Natanz, and Isfahan.
Former US President Donald Trump praised the attack on social media, calling it a “very successful” mission and stating: “There is not another military in the world that could have done this. NOW IS THE TIME FOR PEACE!”