Fuel Duty: 5p Cut Ends August, Staged Rises From September
The temporary 5p per litre fuel duty cut that has held since March 2022 will end on 31 August 2026, then reverse in three stages through to March 2027, according to HMRC's policy paper. For drivers, it sets a clear timeline: duty stays low through the summer, then begins climbing from autumn — a separate force from the oil-market swings now pulling pump prices down.
What changes and when
At Budget 2025 the government extended the 5p (pence per litre) cut to the end of August 2026, avoiding a 5p increase that would otherwise have landed in March 2026. From then, the main fuel duty rates rise in steps: 1p on 1 September 2026, 2p on 1 December 2026, and 2p on 1 March 2027. That gradually restores duty to its pre-March-2022 level of 57.95p a litre on unleaded petrol and diesel, up from the current cut rate of 52.95p. The planned inflation-linked (RPI) increase for 2026 to 2027 has been cancelled, with RPI uprating resuming from 2027 to 2028.
Fuel duty applies to petrol, diesel (B7, the standard blend containing up to 7% biodiesel) and other liquid road fuels. HMRC estimates the measure affects up to 36 million people and, by phasing the rises rather than ending the cut abruptly, saves the average car driver £49 in 2026 to 2027 compared with previous plans.
How it sits against today's prices
Duty is only one component of the pump price, alongside the wholesale cost of fuel, retailer margin and VAT. Right now the wholesale picture is moving the other way: oil has fallen and pump prices are easing. Our figures from the official UK Government Fuel Finder dataset (as of 22 June 2026) show the UK average for E10 petrol — unleaded with up to 10% renewable ethanol — at 153.7p a litre, with Northern Ireland cheapest at 148.1p and the South of England dearest at 155.0p.
The takeaway: any oil-driven savings over the summer are real, but a 1p duty rise from September, then 2p more in December, will work against them. A 1p duty change adds roughly 50p to a 50-litre fill before VAT.
What This Means for Drivers
Expect the cut's benefit to taper from autumn. Through August, duty stays at the reduced rate. From 1 September the first 1p rise applies, with larger steps in December and March. None of this is a single shock — it is staged — but the trend in the duty component is upward into 2027, even as oil markets may push the wholesale component down in the near term.
How to Save on Fuel
- Compare local forecourts every time; the gap between cheapest and dearest in one area often beats any single duty step. You can find the cheapest petrol near you using daily official data.
- Lean on supermarket forecourts, which usually price below premium-brand sites.
- Cut avoidable mileage and keep your car serviced and tyres inflated — the surest way to offset rising duty is to burn less fuel.
Sources
- GOV.UK / HMRC — Fuel duty rates: 2026 to 2027 — published 26 February 2026, accessed 22 June 2026
- UK Government Fuel Finder data via PetrolPricesNearYou.com — dataset as of 22 June 2026, accessed 22 June 2026