Fuel duty freeze extended until the end of the year

The UK government has extended the 5p-a-litre fuel duty cut until the end of the year, delaying a planned phase-out in September. The move — cited as a response to higher petrol and diesel prices driven by disruptions to oil and liquefied natural gas supplies since the US‑Israel/Iran conflict — will cost the Treasury about £455m this tax year. Additional measures include cutting red diesel duty to 6.48p/l from mid next month through year‑end and a 12‑month vehicle excise duty holiday for HGVs (saving a typical heavy haulier around £600). Market impact: the measures should ease near‑term input‑cost pressure on consumers and transport sectors, modestly relieving inflationary pressure and providing limited support to UK assets (including the UK 100 index). Political uncertainty over whether the freeze will be extended next year leaves medium‑term fiscal and inflation implications uncertain.