As the US-Israel war disrupts global oil supplies, UK motorists and airlines brace for impact.
Category: Business
Motorists in the UK are grappling with rising fuel prices and localized shortages as the conflict between the US and Israel escalates in Iran. Since the war began on February 28, 2026, wholesale oil prices have surged dramatically, leading to higher costs at the pump and concerns about fuel availability.
According to BBC News, the price of a barrel of Brent crude oil has jumped from $73 to over $115, a direct consequence of missile strikes and drone attacks disrupting energy production and transportation in the Middle East. This spike in oil prices has already translated to a 19p increase in average petrol prices, which now stand at 152p per litre, and a 40p increase in diesel prices, reaching 181p per litre.
As the UK imports most of its oil and gas from the US and Norway, the rising costs are impacting consumers directly. The UK government and Fuels Industry UK have reassured the public that Britain's fuel supplies remain resilient, with sufficient reserves held to meet demand. The country holds more than the required 90 days' worth of net oil imports, ensuring that, for now, there is no nationwide shortage.
Nevertheless, localized shortages have arisen, particularly in rural areas, where some petrol stations are struggling to receive timely deliveries. Reports indicate that supermarket-linked stations, such as Sainsbury's and Tesco, have temporarily closed some pumps due to increased consumer demand and slower fuel deliveries. Sainsbury's has stated that it expects to fully restock its forecourts later this week, and Tesco's forecourts in Belfast have reopened after experiencing supply issues.
As the situation evolves, Prime Minister Keir Starmer is scheduled to meet with senior energy executives on March 30, 2026, to discuss the potential for fuel shortages in the UK. The meeting will include leaders from major energy firms, including Shell and BP, as well as representatives from shipping giants and financial institutions. The discussions will focus on the impact of the conflict on fuel supplies and strategies to safeguard international shipping routes through the Strait of Hormuz, a key passage for global oil exports.
Starmer has emphasized the importance of stability in the Middle East to reduce pressure on the cost of living in the UK. He stated that the best way to protect consumers is to work collaboratively with industry leaders to address supply chain disruptions caused by the conflict.
Meanwhile, the airline industry is also feeling the pinch. As fuel prices soar, airlines have begun to hike fares and cut capacity in response to the increased costs. Before the conflict, the airline industry had projected record profits of $41 billion for 2026, but the sudden doubling of jet fuel prices has put that forecast at risk.
Airlines such as United Airlines and Air New Zealand have announced fare hikes and capacity reductions, with industry experts describing the situation as an 'existential challenge.' Rigas Doganis, a former head of Greece's Olympic Airways, noted that airlines will need to balance fare increases with the risk of losing price-sensitive customers.
In addition to fuel costs, the conflict has broader implications for food prices in the UK. As petrol and diesel prices rise, transportation costs for businesses are likely to increase, which could be passed on to consumers. Benjamin Godwin, a partner at investment advisory firm PRISM Strategic Intelligence, highlighted that higher fuel prices could lead to increased costs for goods, including food, especially since some crude oil components are used in fertilizers.
Experts warn that the current situation could also impact inflation and interest rates in the UK. The Bank of England has been working to keep inflation close to its 2% target; higher energy prices may hinder that goal. If energy costs continue to rise, it could complicate plans for interest rate cuts, as lenders adjust their rates based on expected movements in the economy.
As the conflict continues, the potential for an oil shortage hangs large. The International Energy Agency (IEA) has suggested measures for reducing energy and fuel use, such as working from home and carpooling, to mitigate the impact of rising prices. The UK government is also coordinating with allies to safeguard freedom of navigation through the Strait of Hormuz, where nearly one-fifth of the world's fuel exports typically pass.
As the situation develops, consumers are advised to remain vigilant, as the potential for localized fuel shortages persists. A spokesperson for the UK government has urged the public to continue acting normally, assuring them that supplies remain stable and that the country sources most of its fuel from North America and Norway.
In light of the current disruptions, the UK must navigate the complex interplay of global energy dynamics, local supply challenges, and the economic implications of rising fuel prices. With the situation still fluid, the coming weeks will be telling for both motorists and businesses as they adapt to the new realities brought about by the conflict.