02.04.202614:12 Analisis Forex & Kajian: Fuel prices squeeze Britons

While the British pound is plunging, gasoline and diesel prices in the United Kingdom are rising rapidly. The war in Iran triggered a record jump last month, increasing pressure on Prime Minister Keir Starmer to intervene and help motorists.

"March has been truly unprecedented – fuel prices have never risen this fast in a single month," the UK motor group RAC said, while noting that the overall cost of filling up a car still remains below 2022 peaks.

The trend is likely to continue in the months ahead. Factors driving the increase include both geopolitical tensions and domestic economic conditions. The pound, weakened by political uncertainty and global economic challenges, is losing purchasing power, making imported fuel more expensive.

Keir Starmer's government is under pressure from the public and industry associations. Motorists facing rising fuel costs are demanding immediate support, while oil companies and distributors point to causes linked to the war in Iran and the closure of the Strait of Hormuz. Despite a month having passed, the conflict continues to have a significant impact on global oil markets. Supply reliability remains under threat, which pushes up futures prices and, consequently, pump prices across the United Kingdom.

On Wednesday, Starmer acknowledged rising energy prices but refrained from announcing any substantial new support measures, which added fresh pressure on the pound. By contrast, Germany introduced limits on the frequency of price increases at petrol stations, and countries such as Slovenia and Hungary cut fuel taxes.

Despite the record surge in March, it is worth noting that the overall cost of filling a car in the United Kingdom has not yet reached the peaks seen in 2022. Nevertheless, for many British households, especially those who depend on private transport to commute and travel, current price levels are already a significant financial burden.

Meanwhile, both the main opposition Conservative Party and the Reform Party, which is leading in some polls, have called on Chancellor Rachel Reeves to accelerate plans to start cutting fuel excise duties.

According to RAC data, petrol rose by 20 pence per liter last month, roughly half the increase recorded for diesel. The larger jump in diesel prices reflects Europe's dependence on imports of that fuel from refineries in the Middle East, which are now involved in the conflict.

Regarding the current technical picture for GBP/USD, pound buyers need to take the nearest resistance at 1.3230. Only this will allow targeting 1.3260, above which a break will be rather difficult. The most distant target is the 1.3290 area. In case of a decline, bears will try to seize control of 1.3200. If they succeed, a break of the range will deliver a serious blow to bulls' positions and push GBP/USD toward the low at 1.3160, with a prospect of reaching 1.3130.