Petrol and diesel price rises push UK inflation higher
Summer holidays and disruption to global oil supplies by the Middle East conflict stoked price growth.
Inflation in the UK rose to 3.1% in the year to August, the highest level in five months, according to the Office for National Statistics. This increase was driven by higher prices for petrol, diesel, and airfares. Vehicle fuel costs surged after conflicts in the Middle East disrupted global oil supplies. Petrol prices hit their highest in nearly four years, while diesel prices also rose.
The cost of flying increased during the summer travel season. Motor fuel prices climbed by 23% compared to the same month last year. Oil prices surpassed $91 a barrel as tensions between the US and Iran continued. Average petrol prices rose by 9.1p to 161.3p per litre, the highest since November 2022. Inflation's impact extends beyond fuel, affecting overall costs and prompting concerns about the UK's economic resilience.
The Bank of England's current inflation target of 2% is being challenged, with the central bank meeting to discuss potential interest rate changes. The UK economy grew by 0.4% in July, but slowed to 0.4% in the April to June quarter. Shadow Chancellor Andrew Griffith highlighted the economic burden of the Middle East war on British families, emphasizing the need for government action to address rising costs.
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