Keir Starmer opens door to scrapping fuel duty hike

 Sir Keir Starmer has hinted at a move to cancel a fuel duty hike amid concerns over the impact that the Middle East crisis will have on the UK economy.

The prime minister told MPs that the planned 5p increase would be “kept under review” before it is due to come into force in September.

Fuel duty is currently frozen to help drivers with the cost of living, but that is due to end in the autumn. Chancellor Rachel Reeves has so far resisted calls to cancel the planned hike in response to the oil price spike caused by Donald Trump’s war on Iran.

But his comments, which came during a tetchy exchange at Prime Minister’s Questions, pave the way for another possible U-turn.

Pressed on the issue by Tory leader Kemi Badenoch, the prime minister said: “We are not increasing the cost of petrol.

“We are absolutely clear in taking the measures that are necessary to deal with the impact of the conflict in Iran.

“We’re dealing with that with other allies, we’re taking the necessary action. But the best thing that we can do is to work with others to de-escalate the situation."

He added: “Fuel duty is frozen. It is going to remain frozen until September. And we will keep the situation under review in light of what is happening in Iran.”

Later, in response to Tory MP Graham Stuart, he added: “In light of what is happening in Iran, of course we will look carefully at the situation.”

Sir Keir’s remarks were a distinct shift in statements given earlier this week by the chancellor, who had insisted that the rise would go ahead in September.

Pressed on the subject in a Commons statement on Monday and then again during Treasury questions on Tuesday, she had added: “Of course, we always keep taxes under review.”

Fears over a cost of living crisis similar to what happened in 2022 as a result of Russia’s invasion of Ukraine have been heightened by the price of oil rising more than 20 per cent to above $100 a barrel and gas more than 50 per cent.

The RAC’s head of policy said on Wednesday that diesel prices have already risen by nearly 9 per cent since 28 February. Meanwhile, petrol prices are on average 6 per cent more across the same period, RAC Fuel Watch said.

But Ms Reeves justified the increase, claiming that fuel duty was already 11p a litre below where they would have been under the plans of the previous Tory government.

Ms Badenoch hit back over his fuel duty comments in response to lengthy criticism by the PM that she herself had U-turned on whether the UK should be joining the US and Israel in attacking Iran.

Sir Keir said Ms Badenoch “relentlessly” attacked him for refusing to join the initial US-Israel strikes, before changing her position.

“Yesterday, in the wake of the economic consequences, the leader of the opposition totally abandoned her position,” he said. “She told the BBC I never said we should join.”

He added: “That is the mother of all U-turns on the single most important decision a prime minister ever has to take – whether to commit the United Kingdom to war or not.”

He said she and Nigel Farage had been “spooked” and were now “furiously trying to backpedal” on their stance.

Responding to the possibility that the fuel duty rise may be cancelled, John O’Connell, chief executive of the TaxPayers’ Alliance, said: “Motorists will be desperately hoping that the prime minister is getting ready to slam the brakes on the planned fuel duty hike.

“Prices at the pump are set to surge over the coming weeks, and yet the government is currently planning to pour petrol on the flames by driving up prices even further.

“The chancellor needs to put taxpayers’ minds at ease by putting a stop to the hike.”

A Conservative Party spokesperson said: “We have just seen a truly shameful display from the prime minister. Six times he was asked why he is raising fuel duty for families and businesses this year, six times he refused to answer, instead smearing the leader of the opposition and deliberately misrepresenting her position on Iran and our armed forces.

“Keir Starmer has shown he doesn’t care about drivers and doesn’t care about the cost of living. He has no answer on petrol prices, because he knows that raising fuel duty for the first time in 15 years is the clearest possible symbol of Labour’s total mismanagement of the economy.”

After PMQs, a Downing Street spokesperson played down divisions between the words of the prime minister and chancellor.

They noted that Ms Reeves had said “things are moving on a daily basis” and added: “It’s our long-established position that decisions around taxes are set at Budgets.”