Petrol prices have reached a new high due to the Iran conflict, prompting the RAC to issue a warning of further price hikes in the near future.

Currently, the average cost of unleaded petrol stands at 158.52p per litre, surpassing the previous peak of 158.31p on April 15. After a slight decrease until early May, petrol prices have started to climb again.

The surge in the price of Brent crude oil following the onset of the Middle East conflict in late February has led to a sharp increase in both petrol and diesel prices.

The RAC projects that unleaded petrol could rise to a minimum of 160p per litre unless there is a substantial and sustained drop in oil prices. As of Tuesday, Brent crude was priced at around $110 per barrel.

According to Simon Williams, the head of policy at RAC, their analysis of wholesale fuel data suggests that unleaded petrol is likely to hit 160p per litre in the coming weeks unless oil prices, which have remained above $100 a barrel since late April, see a significant decline.

While the average price of diesel has notably decreased since its peak in early April, currently at 185.92p per litre, the RAC emphasizes that it should be even lower. The organization urges fuel retailers to pass on the savings from purchasing new supplies to consumers.

A recent investigation by the Competition and Markets Authority revealed that the escalating fuel prices are primarily driven by the increased cost of oil rather than retailers widening profit margins. The CMA noted that the price gap between what retailers pay for fuel and what they sell it for has remained relatively constant since the conflict began.

Despite this, the CMA identified heightened fuel margins for a small number of retailers in March and has committed to investigating this further to ensure fair pricing practices.

Sarah Cardell, the chief executive of the CMA, highlighted the strain the Middle East conflict has placed on UK households and businesses due to the rising fuel prices. The CMA aims to ensure that these price hikes are justified by actual cost pressures and has intensified monitoring efforts to ensure that any cost reductions are promptly passed on to consumers.