Conflict to cost drivers billions more as petrol and diesel prices near record highs
The direct cost of the war in the Persian Gulf to drivers and businesses now tops £7.5 billion, the RAC Foundation estimates.
By taking average daily fuel consumption figures from 2025, and comparing the prices drivers have been paying at the pumps since 28 February when the conflict began with fuel prices before the first bombs were dropped on Iran, the Foundation calculates an extra £7.61 billion has now been shelled out on the forecourts in ‘war premiums’.
That amount is currently growing at around £56 million per day.
Of the £7.61 billion, £1.27 billion is VAT, some of which is likely to be reclaimed by VAT-registered businesses.
Of the total premium £5.36 billion has been paid by drivers of diesel-powered vehicles. The remaining £2.25 billion has fallen on petrol-vehicle drivers.
Steve Gooding, director of the RAC Foundation, said:
“We are now just over six months into this conflict and with oil and pump prices surging again drivers look likely to be on the hook for billions more pounds of ‘excess’ expenditure going into the autumn and winter.
“With the war premium hitting tens of millions of drivers where it hurts – in their pockets – let’s not forget that the Treasury now receives, on average, more than 80p every time a litre of fuel is bought on a UK forecourt.
“Ending the war in the Gulf is out of the government’s hands, but easing the financial pain of sky-high fuel prices being suffered by private motorists and the countless businesses that rely on diesel-powered vehicles is in the gift of the chancellor as he decides what to do about fuel duty in his upcoming budget.”
There are around 4.6 million vans and 10.3 million cars powered by diesel on the UK’s roads with a further 18.9 million cars fuelled by petrol.
Contacts:
Philip Gomm – Head of External Communications – RAC Foundation
[email protected] | 07711 776448
Notes to editors:
The RAC Foundation is a transport policy and research organisation which explores the economic, mobility, safety and environmental issues relating to roads and their users.
It is a registered charity. Charity number: 1002705.
The Foundation publishes independent and authoritative research with which it promotes informed debate and advocates policy in the interest of the responsible motorist. For more information visit www.racfoundation.org