Will UK Petrol Prices Finally Fall? What the Iran Deal Means for Your Wallet
Oil prices have dropped to their lowest levels in months following a peace deal between the US and Iran, and UK drivers are asking the obvious question: when will petrol prices at the pump actually come down?
The price of crude oil briefly fell below $72 a barrel this week – levels not seen since before the Iran war began in February. This matters because oil prices typically feed through to what we pay for fuel. However, as President Trump has publicly complained, petrol prices aren’t falling as fast as the oil price drop would suggest, and British drivers are experiencing exactly the same frustration.
What’s happened to oil prices?
The US and Iran signed a Memorandum of Understanding on 17 June, starting 60-day negotiations to end the conflict. Since then, shipping routes through the critical Strait of Hormuz – which carries roughly a third of the world’s seaborne oil – have begun reopening. Around 80 ships crossed the strait in the days following peace talks, easing supply concerns that had driven prices up sharply during the war.
Why aren’t petrol prices falling at the pump?
Oil companies argue that fuel prices don’t move in lockstep with crude costs – there’s a delay as existing fuel stock is sold, plus distribution, tax, and retailer margins all play a role. In the US, petrol has dropped from April’s peak of around $4 a gallon to $3.93, but it’s still well above pre-war levels.
In the UK, energy firms faced similar accusations of unfairly keeping prices high. The Competition and Markets Authority investigated last month and found no widespread evidence of price gouging, noting that profit margins had remained “broadly unchanged” since February.
What should you do?
Be patient – price drops typically take weeks to appear at forecourts. If you’re struggling with energy costs, check whether you qualify for energy bill support. Keep an eye on your fuel spending as part of your household budget, but don’t expect overnight change. For ongoing advice on managing energy costs, visit Which.co.uk or contact your energy supplier directly about payment plans if you need support.