KEY POINTS
- Chancellor Rachel Reeves has asked the Competition and Markets Authority (CMA) to stay on “high alert” for “unjustifiable” fuel price hikes.
- Reeves and Energy Secretary Ed Miliband are meeting with energy bosses and petrol retailers today at Downing Street to warn against wartime profiteering.
- The government has promised to intervene if companies engage in “unfair” practices, particularly regarding heating oil which is not covered by the energy price cap.
Chancellor Rachel Reeves has launched a significant political push against energy and fuel companies, accusing them of exploiting the current Middle East crisis to charge “rip-off” prices. In a strongly worded letter to the CMA, the Chancellor insisted she “will not tolerate any company exploiting the current situation to make excess profits at consumers’ expense.”
The crackdown comes as the US-Israel war with Iran enters its third week, driving global oil prices above $100 a barrel and causing petrol and diesel prices in the UK to surge. The RAC reported that diesel prices have risen by nearly 9% since late February, while petrol has jumped 6%.
A high-stakes meeting at Downing Street today involving Reeves, Ed Miliband, and industry leaders saw an initial flare-up of tensions. The Petrol Retailers Association (PRA) briefly withdrew from the talks, citing “inflammatory language” by ministers that they claimed had led to the abuse of retail staff. However, the trade body performed a U-turn shortly after and agreed to attend.
Prime Minister Keir Starmer supported the Chancellor’s stance, issuing a statement on social media declaring that “if fuel companies try to rip off customers, my government will step in.” The government is specifically concerned about “rocket and feather” pricing—where prices rise quickly following wholesale increases but fall slowly when costs drop.
The pressure on the Treasury to act is mounting as new economic data showed the UK economy flatlined in January. Critics from the opposition, including the AA and Conservative MPs, are calling for the Chancellor to cancel a planned 5p fuel duty increase scheduled for September to provide immediate relief to households.
Reeves has signaled that “nothing is off the table” regarding targeted support for consumers, though she expressed a preference for market transparency over government subsidies. The CMA has been asked to step up formal requirements for retailers to supply revenue and sales data to ensure a “fair deal at the pump.”
