Oil markets ended the week on a softer note, but don’t let that fool you. Beneath the surface, the fundamentals still point to a market under strain and for consumers, especially across the UK, the impact is only just beginning to bite.
At the time of writing, Brent Crude is trading at around $106.71 per barrel, up from roughly $103 at the start of the week. Meanwhile, West Texas Intermediate has slipped back to $93.58 after starting the week above $99. A late dip, yes - but overall, oil is still firmly on track for weekly gains.
The key driver behind this week’s price movement remains ongoing disruption in the Middle East, particularly around the Strait of Hormuz, one of the most critical arteries for global oil supply.
For a third consecutive week, tanker flows and export logistics have been under pressure. Even the suggestion of instability in this region is enough to move markets. The reality, however, is more serious: when supply chains are disrupted at this scale, recovery is rarely quick or straightforward.
Even if safe passage were restored tomorrow, the backlog of delayed shipments, rerouted vessels, and interrupted production would take time - potentially weeks to normalise.
The slight pullback in prices came after a series of statements from global leaders. These included discussions around restoring tanker flows, the possibility of easing sanctions on Iranian oil, and even releasing additional barrels from strategic reserves. All of this helped calm markets - temporarily.
But there’s a clear gap between talk and execution. None of these measures can deliver immediate supply, and traders are well aware of that. For now, the market is reacting to headlines, not barrels.
Complicating matters further is the continued tension in the region. Reports of ongoing Israeli strikes on Iran highlight just how fragile the situation remains. Diplomatic solutions are being discussed, but tangible progress appears limited.
That uncertainty is what keeps the so-called “war premium” baked into oil prices and it’s unlikely to disappear anytime soon.
For UK drivers, the effects are already visible.
And importantly, these increases don’t yet reflect the full extent of wholesale price rises. There is typically a lag before higher oil prices fully feed through to forecourts. That means more pain is on the way.
There is a very real possibility that diesel prices could approach £2.00 per litre in the coming weeks if current conditions persist.
In the short term, volatility is almost guaranteed. Prices will likely continue to react sharply to geopolitical headlines - rising on signs of escalation and easing slightly on diplomatic developments.
However, the broader picture suggests:
Even in a best-case scenario, where tensions ease quickly, the recovery in supply chains won’t be immediate.
For businesses, fleet operators, and everyday drivers alike, the message is clear: fuel costs are rising, and the pressure isn’t over yet.
Fuel card prices will rise by a further 10 pence per litre for next week, another unwanted week of double digit rises.
