Fuel tax hike plan to be kept under review over Iran, says PM

Sir Keir Starmer has said a planned fuel duty rise from September will be kept under review as the Middle East conflict continues.

The tax rate on petrol and diesel is due to rise from September, when a 5p cut made after Russia's full-scale invasion of Ukraine is set to be phased out over six months.

Speaking at Prime Minister's Questions, Conservative Party leader Kemi Badenoch predicted Sir Keir will be forced to announce "another humiliating U-turn" as she pressed him to scrap the increase.

Sir Keir told MPs that fuel duty is "frozen until September", adding: "We will keep the situation under review in light of what's happening in Iran."

Opposition parties have responded to increased energy prices since the US and Israel began strikes on Iran by intensifying their campaigning to retain the fuel duty cut.

Chancellor Rachel Reeves, speaking to MPs on Tuesday, highlighted fluctuating oil prices and described the situation as "very volatile" while committing to keep things under review.

She told MPs on the Treasury committee earlier on Wednesday that it is "much too early" to guess where petrol prices will be in September and she is "very loath to spend government money on something that the market should be doing".

At PMQs, Sir Keir defended the government's handling of the issue and said the best approach involves working with others to "de-escalate the situation" in the region.

Badenoch said the Conservatives in government froze fuel duty and also cut it in 2022 because "we care about the cost of living".

She added: "Labour think drivers are a cash cow and now they're hiking fuel duty for the first time in 15 years.

"Everyone in this House knows the pattern: first he'll march his backbenchers up the hill, then they'll be forced to defend fuel duty rises in the local elections then there will be another humiliating U-turn.

"So why doesn't the prime minister just stand up, admit he's got it wrong again and scrap the fuel duty hike now?"

Sir Keir replied by highlighting his decisions on the government's approach to the conflict and accused Badenoch of changing her stance on her previous suggestion of UK involvement in offensive strikes on Iran to destroy missile launch sites.

Conservative MP Graham Stuart pressed the same question as he asked Sir Keir if he would continue with the fuel duty rise in September and "add to the misery" of his Beverley and Holderness constituents.

He told the Commons: "Prime minister, for once in this place give the House and people of this country an answer – yes or no?"

Sir Keir repeated that there will no change in fuel duty until September, adding: "In light of what's happening in Iran of course we will look carefully at the situation."

Liberal Democrat leader Sir Ed Davey sought assurances that energy bills "won't rise by hundreds of pounds" in July.

Sir Keir replied: "People will be really worried about the impact on them, and just to reassure households that the cap is in place until the end of June, until July.

"We are working with the sector and with others, and with allies, to do everything we can to make sure those energy bills don't rise. So, we're working round the clock on that."