UK in Talks with Washington as Trump Weighs Diesel Export Ban That Could Push Prices Even Higher

Britain has opened talks with the United States in an effort to head off a possible American ban on diesel exports, while simultaneously drawing up contingency plans in case the measure goes ahead, Chancellor John Healey has confirmed.

The disclosure came as diesel prices in the UK climbed to an all-time high on Monday, piling further pressure on households and businesses already grappling with a severe cost of living squeeze.

According to the RAC motoring organisation, the average cost of a litre of diesel hit 199.33p, edging past the previous record of 199.09p set in June 2022, in the aftermath of Russia's full-scale invasion of Ukraine. Petrol has also been drifting upwards, with a litre now selling for 174.23p.

Speaking to BBC News on the fringes of the Labour Party Conference in Liverpool, Healey acknowledged that pump prices for diesel are "extreme" and said ministers were engaged in detailed discussions with their American counterparts.

"We work very closely with the Americans," he said, adding that the government was "also making the provision that we may need to and we have our own stocks in the UK."

The chancellor's remarks reflect the scale of the risk facing Britain. Roughly one third of the country's diesel imports originate in the United States, meaning that any halt to American shipments would tighten an already stretched market and almost certainly drive prices higher still.

President Donald Trump signalled over the weekend that he was considering restricting exports, telling reporters: "We're thinking about it very seriously." Sources in Washington suggest the motivation is domestic politics: with critical midterm elections approaching, the president is looking for ways to bring down fuel costs for American consumers, and curbing overseas sales is one option under review. The BBC has approached the White House for comment.

The backdrop to the crisis is a global energy market under strain from two overlapping conflicts. The war between the US, Israel and Iran has disrupted both the production and the transportation of wholesale oil across the Middle East for the past seven months, while Russia's ongoing war in Ukraine continues to distort supply routes and refining capacity. Together, these pressures have pushed up the price of fuels derived from crude oil around the world.

Healey was candid that the underlying problem cannot be solved by stockpiles or diplomacy alone. "In the end, we're also working with the Americans where we can try and put in place what will solve this, or at least significantly ease it, which would be a diplomatic settlement [and] an end to the fighting with Iran," he said.

The RAC described the record diesel price as evidence that the UK had entered "uncharted territory," noting that it served as a reminder of "just how exposed the UK is to events occurring far away."

For the chancellor, the timing could scarcely be worse. He is preparing what he called a "breathing space" Budget for 28 October and said he was "very aware" of the cost of living pressures bearing down on families. A freeze on fuel duty, first introduced by the Conservative government in 2022, is due to lapse at the end of the year. Under current plans, duty will rise by 3p in January and by a further 2p in March, adding to the pain at the pumps unless ministers intervene.

The political sensitivity of fuel prices is acute in Britain, where motoring costs feed directly into household budgets and are treated as a barometer of wider economic health. Diesel is particularly important because it powers not just cars but also vans, lorries, buses and much of the machinery used in farming and construction. Sustained increases therefore ripple through the economy, raising the cost of transporting goods and, eventually, the price of food and other essentials on shop shelves.

A ban on US exports would leave Britain scrambling for alternatives at a moment when global supplies are already tight. While the government says it holds its own reserves, these are designed to cover short-term disruption rather than to replace a third of import volumes indefinitely. Sourcing more diesel from elsewhere—whether from European refiners or more distant suppliers—would likely come at a premium, and competition for available cargoes is fierce.

Healey's diplomatic push therefore carries a double purpose: persuading Washington to hold off on a ban, and pressing for a broader settlement in the Middle East that would ease the underlying supply crunch. Whether either objective can be achieved before the Budget remains uncertain, but the chancellor has made clear he sees an end to the fighting with Iran as the only durable solution.

For now, motorists are left confronting prices once considered unthinkable. The record set on Monday surpasses the peak reached during the energy shock that followed Russia's invasion of Ukraine, a moment that prompted emergency measures across Europe. That the UK has now exceeded it while two conflicts continue to simmer underscores how far the global fuel market has yet to normalise—and how vulnerable consumers remain to decisions taken thousands of miles away.