Chancellor Rachel Reeves has faced growing pressure to scrap planned fuel duty rises after fresh turmoil in the Middle East sent oil prices sharply higher.
With the Spring Statement due later today, critics have warned that now is not the time to increase taxes on drivers and increase petrol and diesel costs.
SNP economy spokesperson Dave Doogan warned that families and businesses are already bracing for higher fuel costs following deadly military strikes involving the US and Israel.
At the weekend, forces from the United States and Israel carried out strikes on Iranian targets, resulting in the death of Iran’s Supreme Leader Ayatollah Ali Khamenei, dramatically escalating tensions in the region.
The immediate reaction in global markets was swift as crude oil prices jumped to $80 (£60) a barrel. Analysts have now predicted that if the conflict deepens, prices could surge past $100 (£75).
Any sustained rise would almost certainly feed through to higher prices at petrol stations across the UK, piling more pressure on hard-pressed motorists.
Last year, Ms Reeves confirmed that the long-running fuel duty discount would come to an end this September. Under her plan, fuel duty would rise by 1p initially, followed by two further increases of 2p in December and 1p in April 2027.
She said at the Autumn Budget: “Under current plans, the temporary 5p cut to fuel duty that was introduced during the pandemic will come to an end in April and fuel duty will be uprated in line with inflation.
Chancellor Rachel Reeves will announce the Spring Statement later today
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PA“But I know that the cost of travelling to and from work is still too expensive, so I am extending the 5p cut until September 2026. And because I know that changes in wholesale prices are not always passed onto motorists.”
The fuel duty freeze has been kept in place by successive governments for more than a decade, although critics have argued that scrapping it now would be a major shift at the worst possible time.
A spokesperson for the Treasury said: “We have extended the 5p fuel duty cut from this month to the end of August to support drivers across the country.”
The 5p fuel duty cut was introduced in the aftermath of Russia’s invasion of Ukraine in 2022 | PA
Mr Doogan has urged the Chancellor to abandon the planned rises altogether, stating drivers face what he called a “devastating double hit”.
Speaking ahead of the Spring Statement, he added: “Oil prices are already spiking, the last thing motorists and businesses now need is another damaging tax hike from the Labour Party.
“The Chancellor needs to see sense, recognise what is unfolding globally, and immediately scrap her plans to hike prices at pumps.”
Mr Doogan said rising global oil prices, combined with higher domestic taxes, would squeeze families even further during the cost-of-living crisis.
The 15-year fuel duty freeze was extended at the Autumn Budget
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PAHe also accused Sir Keir Starmer’s Labour Party of failing to deliver on previous promises to cut household energy bills.
“It would be another slap in the face for families if Labour made the cost-of-living crisis even worse with a plan that will inevitably increase prices,” he said.
The SNP spokesperson described the Government as “chaotic”, claiming it had already carried out 14 policy reversals since entering office.
“Scrapping their plans to hike fuel duty is one U-turn motorists, businesses and families right across Scotland would actually welcome,” Mr Doogan added.