Despite rising oil prices amidst the Iranian conflict, Chancellor of the Exchequer Rachel Reeves decided not to use her Spring Forecast to announce any changes to the planned increase in fuel duty, due to be implemented from September this year.
Back in March 2022 Russia’s invasion of Ukraine saw a five pence per litre discount applied to fuel duty, with the tax currently standing at 52.95ppl of petrol and diesel bought.
In her 2025 Budget the Chancellor announced the 5ppl discount will come to an end in September 2026, with staggered duty increases seeing 1p of the discount removed first, then 2p in the following two years.
Now, with a new war bringing fresh oil and fuel price rises, the Petrol Retailers Association had urged the government to delay the planned end to the discount, with the organisation’s executive director, Gordon Balmer, writing to Reeves ahead of the Forecast, saying:
“The conflict in the Middle East has increased the wholesale cost of petrol and diesel, which will mean pump prices will have to go up. Rising fuel prices hurt the economy in the form of higher inflation, impacting already hard-pressed household budgets. To help motorists and businesses, I am today writing to the Chancellor urging her to abandon the planned fuel duty increases.”
That plea was either not heard or not heeded by Reeves, with the only reference to fuel duty in her Spring Forecast being a nod to the announcement she made in her 2025 Budget that the discount will come to an end.
This was arguably to be expected, though, as the Forecast was last year renamed from the Spring Statement to maintain just one major fiscal announcement a year – the Budget.
While the new model of spring speech is based around assessments rather than announcements, the fuel duty discount remains a card up the Treasury’s sleeve, should it need to pull it out as September grows nearer.
