Trump tariffs may bring good news on UK fuel prices

The UK’s stagnating economy is causing pain for drivers at the pumps as fuel costs have risen for the fourth month in a row, exacerbated by a weakening of the pound. However, the imposition of tariffs by US President Donald Trump has resulted in a softening in oil prices, which could eventually have a positive impact on the cost of petrol and diesel.

Throughout January, the price of petrol increased by two pence per litre to £1.37, while diesel rose by roughly three pence per litre to £1.46, making them four and six pence more expensive respectively than they were in October of last year. 

To fill an average family car (with a 55-litre tank) with petrol, drivers are now paying £2 more compared with four months ago, at an average of £76.44 per fill-up. An identically sized tank of diesel would be roughly £3 pricier than in October, at just over £80.

The RAC’s head of policy, Simon Williams, described the news as “not a good start to 2025”, adding that he “hope[s] this trend won’t continue and that prices drop back down again”. 

Williams said: “Much, of course, depends on global oil supply and demand. While the price of oil can be notoriously volatile, there’s reason to think forecourt fuel prices may get cheaper in the coming months.”

Among the reasons for this could be the fallout caused by the recent actions of President Trump. Speaking with Auto Express, executive director of the Petrol Retailers Association, Gordon Balmer, said that Trump’s recently announced tariffs are weakening the price of crude oil, which will in turn lower the price of fuel.

Balmer explained: “The trade tariffs announced, particularly on China, may lead to a further fall [in fuel prices] as they might deliberately weaken the demand for oil.” He also pointed out that, as of April this year, the OPEC group of oil producers have agreed to slowly increase oil output while Trump has already made his intentions clear to “drill, baby, drill”, eyeing up more refineries in Alaska. This potential increase in supply could also keep prices down.

Whether UK motorists will benefit from cheaper fuel remains to be seen, as Balmer pointed out that oil is priced in USD and that the dollar’s recent strengthening could nullify any price reductions incurred by Trump’s actions.

In the meantime, the RAC’s Fuel Watch scheme shows that supermarkets are still the cheapest place to buy fuel, with petrol and diesel prices that are typically 3.5 and four pence per litre below average, respectively.

What are fuel prices in your area? Let us know in the comments below...