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 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 3.2% to $97.94 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 0.5%, while in Europe the UK's FTSE 100 slipped 0.4%, Germany's Dax index was 1.3% lower and France's Cac was down 0.9%. 'I think there's a little bit of nervousness in global markets,' said Victoria Scholar, head of investment at Interactive Investor, stating that '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, but warned that reopening would only happen 'after the United States actually withdraw this aggression', referring to Israel's attacks on Lebanon. 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. 'Weeks are required to move stranded gas and oil cargoes, and months for global trade to approach pre-crisis levels'. 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 warned that if there were fees to pass through the Strait of Hormuz, it would have a major impact, stating: '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.'
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 0.5%, while in Europe the UK's FTSE 100 slipped 0.4%, Germany's Dax index was 1.3% lower and France's Cac was down 0.9%. 'I think there's a little bit of nervousness in global markets,' said Victoria Scholar, head of investment at Interactive Investor, stating that '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, but warned that reopening would only happen 'after the United States actually withdraw this aggression', referring to Israel's attacks on Lebanon. 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. 'Weeks are required to move stranded gas and oil cargoes, and months for global trade to approach pre-crisis levels'. 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 warned that if there were fees to pass through the Strait of Hormuz, it would have a major impact, stating: '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.'
