UK motorists warned petrol prices “remain volatile” despite Middle East ceasefire

Oil markets remain “volatile”, the Petrol Retailers Association says, despite a ceasefire in the Middle East resulting in reduced oil prices.

The war in the Middle East that began on 28 February with US-Israeli strikes on Iran saw fuel prices jump by record levels over the month of March, but a two-week ceasefire agreement announced on Tuesday evening (7 April) led initially to a drop in oil prices.

On the face of it, this is positive news for riders and drivers in the UK, whose oil supply comes mostly from the US and Norway, but its price is nonetheless determined by global markets.

However, the Petrol Retailers Association (PRA) insists the market remains “volatile”.

“Falling oil prices are welcome news for motorists and if this trend continues it should be reflected in lower pump prices,” said Gordon Balmer, executive director of the PRA in a statement released on 8 April. 

“However, it is to be noted [that] this is a temporary ceasefire and the market remains volatile.”

Gordon added: "Oil prices are still above where they were prior to the conflict reflecting tensions in the Middle East and damage to some infrastructure. 

“Fuel supplies in the UK remain resilient and where they need to be. 

“My advice to motorists is that they should fill up as normal, shop around, and use the Petrolprices.com app to locate the best deals in their area.”

While oil prices fell on Wednesday, there emerged fears that the ceasefire will not hold for the agreed two-week period as Israel continued to launch attacks on Lebanon (where the Iran-backed Hezbollah organisation is based) despite Pakistan – which was the leading mediator in negotiations between the US-Israeli side and Iran – stating after the announcement of the ceasefire that the agreement also included Lebanon. 

Iran’s deputy foreign minister, Saeed Khatibzadeh, has also said this morning (9 April) that Israel’s continued attack is against the terms of the agreed ceasefire, as reported by the Guardian.

The apparent disagreement over the terms of the ceasefire have led to doubts over its durability, prompting oil prices to rise once again this morning, although not yet to the same levels they were at before the ceasefire was announced.

The key reason for the increase in oil prices during the current US-Israeli war on Iran has been the latter’s ability to effectively close the Strait of Hormuz, through which around 20 per cent of the world’s global oil supply usually flows. Since the ceasefire came into effect, the flow of ships through the strait is yet to return to normal.

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