Oil prices are notoriously volatile, particularly over the last few years as the price of fuel reached an all-time high. These fluctuations have a direct impact on oil prices in the UK, which ultimately influence the cost of petrol and diesel for drivers and businesses. This is driven by a complex mix of factors that influence supply and demand on a global scale.
From geopolitical tensions and natural disasters to shifts in economic policy, a wide range of forces can push oil prices up or down in ways that are often unpredictable.
This article explores the primary factors behind these fluctuations, including OPEC’s production decisions, economic growth rates and technological developments. By understanding these dynamics, you can gain a clearer picture of why oil prices change and what these shifts mean for you at the pump.
What causes oil price fluctuations?
Oil price fluctuations are primarily driven by the balance of supply and demand, influenced by a range of economic, political, and environmental factors.
On the supply side, production levels set by major oil-producing countries, particularly OPEC (Organisation of the Petroleum Exporting Countries), play a significant role. When production increases, prices generally fall, and when it decreases, prices often rise.
Geopolitical tensions in key oil-producing regions, like the current conflict in the Middle East, can disrupt supply and lead to sudden price spikes.
In terms of demand, global economic growth is a major factor. In periods of rapid economic expansion, demand for oil rises, pushing prices higher, whilst economic slowdowns reduce demand and lead to lower prices. This was seen during the Covid-19 pandemic when the price of fuel plummeted in the UK.
Other factors include currency fluctuations, especially the strength of the US dollar (in which oil is typically traded), and market speculation, as investors react to forecasts and trends. This contributes to price shifts that influence oil prices in the UK and ultimately determine what drivers pay at the pump.
Are oil prices rising right now?
In 2024, oil prices have somewhat stabilised, hopefully marking an end to the extreme volatility we’ve experienced over the last few years. However, global events have affected the oil market and there’s still uncertainty about the impact they could have on the price of oil. These global market movements often lead to a car oil price change in the UK shortly afterwards, as retail fuel prices respond to fluctuations in crude oil markets.
The price of Brent crude oil is currently around $75 a barrel* which is slightly higher than in September. This is due to several reasons:
Delays to increase oil output
Last week, OPEC+ announced they would postpone plans to gradually increase oil output until the end of December 2024. Although this should help to settle the markets, Brent crude oil prices immediately rose by 2.7%.
Conflict in the Middle East
The ongoing conflict in the Middle East, particularly the Israel-Gaza crisis, has elevated fears of broader regional instability that could disrupt oil supply routes. Although oil production has largely remained unaffected so far, there are concerns about the potential for further escalation that might impact major oil-producing countries.
US election
Donald Trump winning the US election had a ripple effect on the oil market with oil prices initially falling. Investors will closely monitor the impact of his re-election and the potential fallout on the oil supply. It’s likely that at least in the short-term, prices may fluctuate as a result.
How rising oil prices impact UK businesses and car oil prices in the UK
Petrol price movements are determined by the price of crude oil and the exchange rate between the dollar and the pound. When global oil benchmarks increase, this often leads to a car oil price change, meaning car oil prices in the UK may rise in the following days or weeks as forecourts adjust their pump prices. So, if oil prices rise then UK pump prices will too. This will have a significant impact on UK businesses, as higher fuel prices will lead to increased operational costs.
Companies that depend on vehicle fleets, such as logistics and delivery businesses, face difficult choices. They can either absorb these costs which affect profitability, or pass them onto customers, potentially impacting competitiveness and demand.
Rising oil prices can also add to the pressure on small businesses, as they often operate on tighter margins and have limited pricing power.
Fuel cards can be a cost-effective solution, as you pay a fixed-weekly price which is often cheaper than the pump, especially on motorways. This can help businesses mitigate the impact of rising fuel prices and improve the efficiency of their fleet.
However, fuel card prices are more closely aligned with the wholesale cost of fuel than what is advertised at the pump. This means costs can sometimes increase sooner as the impact of the oil market on the pumps can be delayed.
Practical tips for managing fuel costs amid rising oil prices
To manage fuel costs during periods of volatility, you can take several practical steps to improve efficiency and reduce expenses. These include:
Adopt telematics – using telematics systems can help you monitor fuel usage, optimise routes, and reduce idle time, all key contributors to fuel savings.
Use fuel cards – our fixed-price fuel cards offer competitive fuel prices and consolidated billing, helping you manage cash flow more effectively and track the fuel expenses of your fleet.
Educate your drivers – training your drivers on fuel-efficient driving practices, such as gentle acceleration and braking, which can lower fuel use. Explore our hypermiling tips to discover how to prevent unnecessary fuel consumption.
Consider alternative fuels – switching to a greener vehicle can provide long-term cost savings, especially as the infrastructure for electric vehicles expands. This is just one reason why businesses should switch to electric.
Stay informed on market trends – monitor oil prices in the UK and global market developments so you can anticipate potential car oil price changes and adjust budgets accordingly.
Oil price fluctuations are influenced by a complex web of global factors. Understanding these dynamics is essential for businesses, as it allows for more informed financial planning and adaptation to volatile markets.
Implementing cost-saving technologies and fuel-efficient practices can help mitigate some immediate impacts. However, long-term strategies focusing on sustainability may ultimately provide greater resilience against future oil price volatility.
Right Fuel Card can help you manage fuel costs more effectively, especially amid rising prices. Compare our range of fuel cards or contact our team to discuss your options further.
*Prices accurate as of 08th November 2024
Oil Market Update (2026): New Developments Affecting Global Fuel Prices
Update added: 9 March 2026
Since this article was originally published in November 2024, global energy markets have experienced renewed volatility due to geopolitical developments in the Middle East. These events have significantly affected oil prices, shipping routes and global energy supply chains.
Below is a breakdown of the latest developments shaping oil prices in 2026 and what they may mean for businesses and fuel consumers.
Escalating conflict and the Strait of Hormuz crisis
One of the most significant drivers of oil price volatility in 2026 has been the escalation of conflict involving Iran, the United States and Israel.
The crisis has centred around the Strait of Hormuz, a narrow but strategically vital waterway connecting the Persian Gulf with the Arabian Sea. Around 20% of the world’s oil supply and a large share of global liquefied natural gas shipments normally pass through this route.
Following military strikes and retaliatory actions in late February 2026, Iran threatened to block the strait and warned that vessels attempting to pass through could be attacked. This caused tanker traffic through the region to drop sharply, with shipping activity falling dramatically within days.
Because such a large proportion of global energy supplies relies on this single transit corridor, even the risk of disruption can trigger immediate reactions in global energy markets.
Oil prices surge as markets react to supply risks
Energy markets responded quickly to the geopolitical uncertainty.
Brent crude oil prices initially surged 10-13% in early March 2026, reaching around $80-$82 per barrel, as traders priced in the risk of supply disruption.
As the conflict escalated and tanker movements slowed further, prices climbed even higher. At one stage, Brent crude exceeded $100 per barrel for the first time in several years, briefly peaking above $110 before fluctuating again.
Analysts have warned that if disruptions to oil shipments continue, prices could remain elevated or even rise further. Some forecasts suggest oil could climb significantly above $100 per barrel if supply through the region remains restricted for an extended period.
Shipping disruption and rising transportation costs
Oil price volatility is not only about supply and demand - transportation logistics also play a major role.
As tensions increased, insurers withdrew war-risk cover for ships operating in the region, and many tanker operators temporarily halted transit through the Strait of Hormuz.
This led to a dramatic spike in shipping costs. Data from shipping markets showed that very large crude carrier (VLCC) charter rates for routes from the Middle East to Asia surged above $400,000 per day, more than double typical levels.
At the same time, more than 150 tankers were reported waiting in the Gulf, unable or unwilling to pass through the strait due to safety concerns.
Higher freight and insurance costs raise the overall cost of transporting crude oil and refined fuels, potentially amplifying the impact of rising oil prices on global markets.
Wider economic impact of energy market volatility
The current energy market disruption has effects far beyond crude oil prices.
The conflict and shipping disruptions have also caused:
Rising global natural gas prices.
Increased transportation and logistics costs.
Declines in global stock markets.
Concerns about inflation and economic slowdown.
Energy analysts have warned that prolonged disruption could raise global inflation by around 0.8%, as higher energy costs feed through to transport, manufacturing and food production.
Because oil is a fundamental input for many sectors of the global economy, sustained price increases can ripple through businesses and consumers worldwide.
What this could mean for UK fuel prices
Although UK drivers and businesses do not buy crude oil directly, pump prices are strongly influenced by global oil benchmarks. For drivers and fleet operators, these global shifts can quickly translate into changes in car oil prices in the UK, particularly when crude prices remain elevated for extended periods.
When Brent crude rises sharply, the cost of refined fuels such as diesel and petrol typically increases shortly afterwards. There is usually a lag of several days or weeks before those changes filter through to retail forecourts.
In addition to crude prices, UK fuel prices can also be affected by:
Currency exchange rates between the US dollar and the British pound.
Shipping and refining costs.
Fuel duty and taxation.
Supply chain disruptions.
If oil prices remain elevated due to geopolitical tensions, this could lead to higher pump prices in the UK during 2026.
Why businesses should continue monitoring oil markets
For businesses that rely on transport, logistics or vehicle fleets, understanding the factors influencing oil prices is essential. Monitoring oil prices in the UK and anticipating potential car oil price changes allows businesses to plan ahead and manage fuel budgets more effectively.
Recent events highlight how quickly global developments can influence fuel markets. Even without long-term supply shortages, geopolitical risk alone can cause significant short-term price volatility.
Businesses can mitigate some of these risks by:
Monitoring fuel price trends and market developments
Improving fleet efficiency and fuel management
Using tools such as fuel cards to manage costs and budgeting
Planning for potential price fluctuations in operational forecasts
While the long-term outlook for oil markets remains uncertain, staying informed about global developments can help businesses respond more effectively to changing fuel costs.
Market data and developments accurate as of: 9th March 2026, 09:00 GMT
Please note: Energy markets can shift rapidly in response to new geopolitical events, data releases, or policy changes. The price levels and forecasts discussed here reflect conditions as of publication, but may evolve quickly. Staying informed and regularly reviewing your plans is the best defence against unexpected developments.
FAQs about oil prices in the UK
Why do oil prices change so frequently?
Oil prices change due to a combination of global supply and demand, geopolitical tensions, currency fluctuations, and production decisions from major oil-producing countries. These factors can quickly trigger a car oil price change, which eventually affects car oil prices in the UK.
How do global oil prices affect UK fuel prices?
Global crude oil benchmarks such as Brent crude strongly influence oil prices in the UK. When crude oil prices increase, the cost of refined fuels such as petrol and diesel typically rises soon afterwards.
Businesses that rely heavily on fuel may benefit from monitoring market trends and using tools that help manage fuel costs more effectively.
How can businesses reduce the impact of rising oil prices?
Businesses can manage rising car oil prices in the UK by improving fuel efficiency, monitoring fleet usage, and using fuel cards to control spending.
Training drivers in fuel-efficient driving techniques can also help reduce fuel consumption. Our guide to hypermiling techniques explains how drivers can maximise fuel efficiency and reduce unnecessary fuel use.
Why do fuel prices sometimes rise faster than they fall?
Fuel prices can rise quickly when oil markets experience disruption, but they may fall more slowly due to supply chain factors such as refining costs, transportation, and existing fuel stock purchased at higher prices.
Understanding the factors influencing oil prices in the UK can help businesses better prepare for future price volatility.
About Right Fuel Card
Right Fuel Card is a leading UK business fuel card provider dedicated to helping businesses of all sizes, from sole traders to large fleets, take control of their fuel costs and simplify fuel expense management. With access to over 98% of UK fuel stations, competitive pricing, and HMRC-approved digital invoicing, we make fuel management effortless whilst helping you save money. Our comprehensive service includes detailed online reporting, dedicated customer support, and optional RightProtect legal support for complete peace of mind on the road. Whether you're managing a single vehicle or an entire fleet, Right Fuel Card provides the tools and support you need to operate efficiently and compliantly.
Ready to start saving on fuel costs? Compare fuel cards online to find the perfect solution for your business. It takes just minutes to see how much you could save, and our expert team is ready to help you get started today.
All information contained within is correct at the time of writing. We try our best to continue to update our guides, but not all guides are regularly reviewed - for the latest news and insight visit: rightfuelcard.co.uk/news-insights
