RACHEL Reeves insists her priority is “keeping costs down” for struggling families in the strongest sign yet she will abandon a fuel duty hike this year.
The Chancellor vows she will do “everything in my power” to protect households and businesses by averting an increase in pump prices amid the energy price shock.
Her intervention came as forecourt costs across the country dropped slightly but diesel is still just below 191p per litre and petrol is at 157p per litre, the RAC said.
Energy costs have soared since the US airstrikes on Iran led to the closure of the Strait of Hormuz, stopping oil and gas supplies from leaving the region until yesterday (Fri).
But the Chancellor last night told The Sun: “I know families are worried about what’s happening in the world right now. About what it means at the pumps, at the tills and for people’s pockets.
“People are struggling. As Chancellor, my priority is keeping costs down for families and businesses – and I’m angry that they will feel the financial fallout of a war that’s not their fault.
“But those costs are real, and I want to reassure the British people that I get it – I will do everything in my power to protect them.
“The world is uncertain right now. Working people deserve a Chancellor who listens and acts. I am doing both.”
The 5p fuel duty discount is due to expire from September when it will gradually be phased out fully by March next year.
It was brought in under the Tories in response to Russia’s invasion of Ukraine back in 2022 to help counter high prices.
Both petrol and diesel have begun to drop for the first time since before the war started.
But petrol is still 25p more a litre and diesel is up by 48p per litre since the start of the conflict, the RAC said.
Simon Williams, from the RAC, said: “After 46 days of rising prices, the cost of both petrol and diesel across the country has finally begun to drop very slightly.
“After record rises, drivers will be relieved to finally see prices going the other way.
“While we’re a long way from a return to the prices we had at the start of the conflict, there’s now a glimmer of light at the end of the tunnel.”
Any decision by the Chancellor to scrap the fuel duty hike will cost the public purse around £2.6 billion.
She is under intense pressure balancing the public finances with the International Monetary Fund downgrading the UK’s growth prospects this year and next.
She is grappling with demands to fill a £28 billion black hole in the defence budget and also reduce the ballooning welfare budget.
Reeves said it would have been better to carry on with diplomatic efforts to ensure Iran didn’t have a nuclear weapon rather than going down the military channel.
FUEL TAX HIKE ‘UNDER REVIEW’
By Rachel Reeves, UK Chancellor
I know families are worried about what’s happening in the world right now. About what it means at the pumps, at the tills and for people’s pockets.
People are struggling. As Chancellor, my priority is keeping costs down for families and businesses – and I’m angry that they will feel the financial fallout of a war that’s not their fault.
But those costs are real, and I want to reassure the British people that I get it – I will do everything in my power to protect them.
Just look at my record.
When I became Chancellor, the previous government had planned to put fuel duty up.
We didn’t. We froze it, extended the 5p cut, and launched Fuel Finder to help drivers find the cheapest prices.
The average motorist is around £90 better off as a result.
And I have put fuel stations on notice – through the Competition and Markets Authority – that their pricing must be fair. No one should be using global uncertainty as cover to make excess profits at the pump.
But I’m not going to stand here and tell you the job is done.
I have always stood up for working families – bringing bills down where we can, raising pay where we should.
And because of the decisions I have taken, households are better placed to weather the shocks the world throws at us.
Fuel duty – like every tax – stays under review. The world is uncertain right now.
Working people deserve a Chancellor who listens and acts. I am doing both.
