When Will Fuel Prices Drop? How the Strait of Hormuz Is Squeezing UK Drivers at the Pump

The last time British motorists felt genuine relief at the forecourt, many were quietly hoping it might last. It didn't. And now, with geopolitical tensions simmering around one of the world's most strategically critical waterways, the question on every driver's lips is the same: when does it end?

The Strait of Hormuz — a narrow channel of water between Iran and Oman, barely 33 kilometres wide at its narrowest point — controls the flow of roughly 20% of the world's traded oil. When anything happens near it, UK pump prices feel the ripple within days. Right now, those ripples are turning into waves.

What's Actually Happening: The Hormuz Situation Explained

As reported by Autocar, recent diplomatic and military developments around the Strait of Hormuz have created fresh uncertainty in global oil markets, with direct consequences for petrol and diesel prices in the UK. The precise nature of any "deal" being discussed is still evolving, but the underlying dynamic is well established: when tensions rise in the Persian Gulf, oil traders price in risk, crude benchmarks climb, and UK forecourts follow — usually within a week to ten days.

The Strait sits at the mouth of the Persian Gulf, through which pass tankers carrying oil from Saudi Arabia, the UAE, Kuwait, Iraq, and Iran itself. Any credible threat to that passage — whether military posturing, sanctions enforcement, or naval incidents — sends a shockwave through Brent Crude pricing. And Brent Crude is the benchmark that ultimately determines what you pay to fill up your Ford Focus.

In recent months, the combination of US-Iran tensions, Houthi activity in the Red Sea (a connected pressure point on global shipping), and fluctuating OPEC+ production decisions has kept oil markets on edge. Even a partial resolution — or a credible framework for one — can shift crude prices meaningfully. But "meaningful" in oil market terms doesn't always translate into immediate savings on the forecourt.

Why UK Drivers Feel It Harder Than Most

Here's something that often gets lost in the headlines: roughly 60p in every litre of petrol you buy is tax, not the cost of the fuel itself. That figure comprises fuel duty — currently frozen at 52.95 pence per litre, a rate that has been held since 2011 after successive governments chose not to increase it — plus 20% VAT applied on top of the total pump price.

This structure means that when crude oil prices fall, UK drivers don't get the full benefit. Conversely, when crude rises, the tax component remains fixed, but it amplifies the proportional pain because it represents such a large share of the final price.

The Energy Prices Act 2022 gave the government emergency powers to intervene in energy markets, but these were primarily designed for gas and electricity. There is no equivalent statutory mechanism that compels fuel retailers to pass on wholesale savings to consumers within a set timeframe — a gap that the Competition and Markets Authority (CMA) has previously highlighted in its scrutiny of the UK road fuels market.

The CMA's 2023 road fuel market study found that supermarkets in particular were slower to pass on falling wholesale costs than they were to raise prices when costs climbed. That asymmetry — known informally as "rockets and feathers" — is not illegal, but it is deeply frustrating for drivers, and regulators have been pushing for greater transparency ever since.

The Legal Framework: What Protections Exist?

Under the Petroleum (Consolidation) Regulations 2014 and associated trading standards legislation, fuel retailers must sell fuel that meets British Standard EN 228 (for petrol) and EN 590 (for diesel) in terms of quality. But there is no legal obligation to sell at any particular price, and no statutory cap on forecourt margins.

What has changed is the transparency landscape. Following the CMA's road fuels investigation, the government introduced a Pumpwatch scheme — a real-time fuel price monitoring system requiring larger fuel retailers to report their prices daily. The scheme, which came into effect in late 2023, is administered by the Department for Energy Security and Net Zero and is designed to give drivers the information they need to find cheaper fuel nearby.

Critically, the Pumpwatch data is publicly accessible. Drivers can use it directly, and it underpins comparison tools on sites such as Confused.com and PetrolPrices.com. This is a genuine legal development that gives consumers meaningful power — but only if they actually use it.

There is also a broader consumer protection angle. Under the Consumer Rights Act 2015, if you pay for fuel and it causes damage to your vehicle — for instance, contaminated diesel — you have statutory rights to seek compensation from the retailer. This is worth remembering, particularly when filling up at unfamiliar or independent forecourts.

What Drivers Should Actually Do Right Now

Given the current uncertainty, here is practical advice that goes beyond the obvious "shop around" platitude:

1. Use Pumpwatch data actively The government's Pumpwatch scheme means that real-time price data is available. Apps such as Waze and Google Maps now incorporate fuel price data, and dedicated tools like PetrolPrices.com allow you to filter by postcode and fuel type.

2. Fill up mid-week, not at weekends Historically, UK forecourt prices tend to creep up on Thursdays and Fridays ahead of weekend demand. Mid-week fills — particularly Tuesday and Wednesday — often catch prices at their weekly low.

3. Supermarket forecourts remain your best bet Despite the CMA's criticism of their pricing behaviour, supermarket forecourts — Asda, Tesco, Sainsbury's, Morrisons — consistently undercut motorway services and branded independents by 5–10 pence per litre. On a 55-litre tank, that is a saving of up to £5.50 per fill.

4. Consider your driving style before your fuel type If you're covering fewer than 10,000 miles per year, diesel is unlikely to offer you any cost advantage over petrol, particularly given that diesel currently commands a premium at the pump. The efficiency gains of diesel only materialise over longer motorway journeys.

5. Loyalty schemes and cashback cards Several major supermarkets offer fuel loyalty points or cashback on fuel purchases through their credit cards. Tesco Clubcard, for instance, can effectively reduce your per-litre cost when points are redeemed against fuel vouchers.

6. Check your tyre pressures Under-inflated tyres increase rolling resistance and fuel consumption by up to 3%. Given current prices, that is not a trivial saving. The Road Vehicles (Construction and Use) Regulations 1986 require that tyres be properly inflated — but beyond the legal obligation, it is simply good economics.

Looking Ahead: Will Prices Actually Fall?

The honest answer is: it depends on factors largely outside the UK's control.

A genuine, durable resolution to tensions around the Strait of Hormuz would likely push Brent Crude lower, and UK pump prices would follow — with the usual one-to-two-week lag. However, OPEC+ has shown a willingness to manage production levels to defend oil prices, which acts as a floor under crude even when geopolitical risk eases.

The Office for Budget Responsibility has consistently projected that fuel duty will remain frozen through the current parliament, which removes one potential upward pressure. However, there is growing political discussion about whether the freeze — which costs the Treasury approximately £6 billion per year in foregone revenue — is sustainable as the government seeks to balance public finances.

If fuel duty is eventually unfrozen and increased, even a 5p per litre rise would add roughly £2.75 to a typical tank. Combined with any crude oil price recovery, that could push petrol back toward — or beyond — the 150p per litre mark that caused such political pain in 2022.

For now, the best strategy for UK drivers is informed patience: use the transparency tools available, drive efficiently, and resist the temptation to panic-fill if prices dip briefly. The forecourt market is volatile, but it is not entirely opaque — and drivers who understand how it works are better placed to navigate it.

The Strait of Hormuz may be 5,000 miles away, but its influence reaches every petrol station on every British high street. Understanding that connection is the first step to managing your costs in a world where geopolitics and motoring are, increasingly, inseparable.