The UK government is preparing to postpone a planned rise in fuel duty that had been due to take effect in September, according to a person familiar with the matter. The decision responds to recent increases in petrol and diesel prices that have followed conflict-related developments in the Iran region.
Under the current timetable, fuel duty was scheduled to increase by 1 pence per litre in September, with further rises of 2 pence in December and another 2 pence in March 2027. The forthcoming announcement will reportedly confirm a delay to the September element of that schedule; the timing of the public statement is expected to be soon.
Motor fuel price inflation has been a persistent factor keeping the headline inflation rate in the UK above the Bank of England's 2% target in recent months. Higher pump prices also feed into the prices of other goods, adding upward pressure across consumer-facing sectors. The combination of direct fuel costs and knock-on effects in goods prices has intensified scrutiny on aggregate household spending power.
The policy move comes as the new government under Keir Starmer faces increased pressure to tackle the broader cost-of-living challenge facing households. Officials appear to be weighing the short-term relief of delaying a duty rise against the previously announced trajectory of smaller increases later in the fiscal calendar.
Details beyond the expected near-term postponement remain limited in the available reporting. Officials have not provided a public timetable for any reassessment of the later scheduled increases, and the single source cited stressed familiarity with the matter rather than an official statement.
The decision highlights the interaction between energy costs, consumer price inflation and fiscal policy choices as authorities balance revenue considerations with political and economic pressures on household budgets.