UK in Talks with Washington as Trump Threatens to Halt Diesel Exports

Britain has opened urgent discussions with the United States over a possible halt to American diesel shipments, Chancellor John Healey has confirmed, as the government simultaneously begins drawing up contingency plans in case the taps are turned off.

Speaking to BBC News, Healey said the UK was engaging with US authorities about the threat while also preparing for the possibility that talks fail. "We're also making the provision that we may need to and we have our own stocks in the UK," he said.

The intervention came as diesel prices in Britain hit an unprecedented level on Monday, with the average cost of a litre reaching 199.33p, according to the motoring organisation the RAC. That exceeds 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 climbing, with a litre now priced at 174.23p.

The chancellor described the current diesel price as "extreme" and said he was "very aware" of the pressure this places on households and businesses. He made the remarks on the sidelines of the Labour Party Conference in Liverpool, where cost-of-living concerns are expected to dominate the agenda ahead of what he has called a "breathing space" Budget on 28 October.

At the root of the surge are two overlapping conflicts that have disrupted global energy supply chains. The war between the US and Israel on one side and Iran on the other has, over the past seven months, severely hampered the production and transportation of wholesale oil across the Middle East. Russia's ongoing war in Ukraine has simultaneously squeezed supplies, and the combined effect has driven up the price of fuels refined from crude oil worldwide.

US President Donald Trump added to the uncertainty at the weekend by suggesting he could block diesel exports, telling reporters: "We're thinking about it very seriously." Sources in Washington indicate that the proposed ban is being considered as a way to lower prices for American consumers before the critical midterm elections, when fuel costs are likely to be a decisive issue at the ballot box. The BBC has approached the White House for comment.

The stakes for Britain are considerable. Roughly one third of UK diesel imports come from the United States, meaning a ban would tighten an already stretched market and could push pump prices even higher. The RAC said the record price showed diesel had entered "uncharted territory" and served as a reminder of "just how exposed the UK is to events occurring far away."

Healey stressed that London and Washington were working closely together, and he framed the longer-term fix as diplomatic rather than logistical. "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.

Domestically, the chancellor faces a separate fiscal dilemma. A freeze on fuel duty, first introduced by the Conservative government in 2022 and maintained since, is scheduled to lapse at the end of the year. Under current plans, duty would rise by 3p in January and by a further 2p in March, adding to costs at the pump just as drivers are already reeling from record diesel prices.

Motoring groups and business organisations have warned that any increase would compound the squeeze on hauliers, farmers and small firms that rely on diesel to operate. A freeze extension would carry a significant cost to the Treasury, however, leaving Healey to weigh relief for motorists against his broader budget arithmetic.

Energy analysts note that the UK's reliance on imported refined fuel leaves it unusually vulnerable to decisions taken in Washington. Unlike crude oil, diesel is a finished product with limited substitutes in the short term for sectors such as freight, agriculture and construction, so a sudden reduction in supply tends to feed through to prices quickly.

The government's stated fallback — domestic stocks — offers only a temporary cushion. Strategic reserves can bridge a short disruption, but they cannot replace a sustained loss of a third of imports without significant strain. Officials have not disclosed how many days of supply the UK currently holds or how the reserves would be released if needed.

For now, the chancellor's message is one of dual-track diplomacy: talk the Americans out of a ban, and prepare in case the talks fail. "Fundamentally, what we need is a settlement in the Middle East," he said. "We need an easing of the pressure of costs on business, the costs on households and on ordinary families that we see at the pumps in the most extreme level today for diesel."

Whether that settlement arrives before the export threat materialises remains uncertain, and the coming weeks will test both the resilience of UK fuel supplies and the strength of the transatlantic relationship on which a portion of them depends.