Petrol prices hit new record high of 173p a litre as EU bans Russian oil imports

Average petrol prices have reached a new record high of 173.02p a litre after an EU ban on most Russian oil imports.

It cost £95.16 to fill an average family car on Tuesday, the RAC said.

Fuel prices have been setting record highs every few days in recent weeks, piling more pressure on struggling households that are also seeing food, gas and electricity costs rise sharply.

Petrol and diesel have risen on the back of higher oil prices after supplies were disrupted by Russia’s invasion of Ukraine, and western sanctions imposed in response. Meanwhile, demand has risen as the world has emerged from the Covid pandemic.

European Union leaders moved on Monday night to impose a partial oil embargo on Russia, following a summit that saw a long-delayed package of sanctions blocked by Hungary.

The watered-down embargo covers only Russian oil brought in by sea, allowing a temporary exemption for imports delivered by pipeline.

It was enough to send oil prices higher on Tuesday morning with international benchmark Brent crude trading at $123.50 per barrel, up 1.5 per cent. West Texas Intermediate, an American oil blend, was up 2.7 per cent to £118.20.

Analysts warned that motorists could face further fuel price hikes if the EU agrees a tougher oil embargo in future.

Callum Macpherson, head of commodities, at Investec, said oil markets had been surprised to hear that EU member stated had reached a deal overnight.

“This deal is clearly watered down from what was originally proposed several weeks ago,” Mr Macpherson said.

“It is maybe that the EU, knowing it would face credibility issues if it did not do something, decided it was better to get a deal done and can then work to implement a stronger ban over time. We now wait to hear more detail on timelines and additional sanctions.”

Prices at the pumps are also being pushed up by a lack of capacity to refine crude oil into its various component parts such as petrol and diesel.