Petrol hits new record high of 159.6p as Russia’s invasion of Ukraine disrupts oil supplies

Average prices rise again but some signs of hope emerge for squeezed motorists

The average cost of a litre of diesel reached a new high of 167.4p on Wednesday, up from 165.2p on Tuesday (PA Wire)

Petrol and diesel prices surged to a new high on Wednesday as Russia’s invasion of Ukraine caused major disruption to oil supplies.

Figures from data firm Experian Catalist show the average cost of a litre of petrol at UK forecourts was 159.6p, up from 158.2p on Tuesday.

The average cost of a litre of diesel reached a new high of 167.4p on Wednesday, up from 165.2p on Tuesday.

Petrol prices hit more than £2 a litre at some London forecourts, as retailers passed on the rising cost of crude to their customers.

There were some signs that the squeeze on motorists may soon begin to ease as the United Arab Emirates said it supported increased production.

The UAE is an influential member of Opec, the cartel of major oil-producing countries. Opec has some capacity to increase oil output but has so far held off doing so, agreeing only to continue along a planned production schedule agreed before Vladimir Putin sent Russian troops into Ukraine.

“We favour production increases and will be encouraging Opec to consider higher production levels,” ambassador Yousuf Al Otaiba said in a statement tweeted by the UAE embassy in Washington.

The announcement sent crude prices tumbling, with Brent crude – a key international benchmark – dropping as much as 17 per cent before settling at around $116 on Thursday morning.

The International Energy Agency (IEA) also said on Wednesday that it could release more of the world’s strategic oil reserves after it recently agreed to add an extra 60 million barrels to global supplies.

“If there is a need, if our governments decide so, we can bring more oil to the markets, as one part of the response,” said IEA chief Faith Birol.

The US and UK moved to phase out imports of Russian oil this week as part of measures to apply further pressure on Mr Putin.

Western leaders have conceded that weening their economies off of Russian oil and gas will mean economic pain for their own citizens, as well as those in Russia.

It leaves a difficult balancing act for European governments in particular because the continent is so reliant on Russian energy imports and is also facing a cost-of-living squeeze.

In the UK, inflation is now predicted to be 8 per cent this year with a peak as high as 10 per cent according to latest forecasts from KPMG. That would almost certainly mean a big fall in living standards for millions of people whose wages will fail to keep up with rising prices.