What is happening with fuel duty?
At Prime Minister’s Questions yesterday, Sir Keir Starmer and Leader of the Opposition Kemi Badenoch clashed over fuel duty after prices increased this month due to conflict in the Middle East.
Mrs Badenoch claimed the Prime Minister was “hiking fuel duty for the first time in 15 years.” And when asked how he could justify this, Mr Starmer said: “There has not been a rise. Fuel duty is frozen. It is frozen until September”.
Both these claims are correct.
In September 2026 a 5p cut to fuel duty introduced back in March 2022 will begin to be phased out. As Mrs Badenoch claimed, this will be the first increase in fuel duty since 2011.
In response to another question from Mrs Badenoch, Mr Starmer said the government “will keep the situation under review in the light of what is happening in Iran.”
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What is fuel duty?
Fuel duty is a tax on the price per litre of fuel. Different types of fuel have different rates; it is currently 52.95p per litre of unleaded petrol and diesel.
Though stated government policy is that the rate of fuel duty should increase annually in line with Retail Price Index (RPI) inflation, this has not happened since 2011.
In March 2022, in the aftermath of the full-scale Russian invasion of Ukraine and consequent increases in fuel prices, the then-Conservative government introduced a 5p cut to the fuel duty price for petrol and diesel.
This was initially intended to be a “temporary 12 month cut”, but it was extended for a further 12 months under the Conservatives in both 2023 and 2024, and again by Labour in its Autumn 2024 Budget, when the government said it would last until April 2026.
What’s happening now?
In last November’s Budget, the government said the 5p cut would be extended again, until the end of August 2026. It said the cut would then be gradually phased out between September 2026 and March 2027, when the duty would return to the same rate it was in March 2022—57.95p for petrol and diesel.
Fuel duty is set to increase by 1p from 1 September 2026, then by 2p from 1 December 2026 and 2p from 1 March 2027.
The government also said in November 2025 that the increase to fuel duty in line with RPI inflation would once again be cancelled for 2026/27, though from 1 April 2027 it will be uprated annually in line with RPI inflation (unless the government chooses to cancel this increase again).
Opposition parties and politicians have called on the government to cancel the planned 5p increase.