Fuel price volatility in rural and island Scotland
Since the conflict in the Middle East began at the end of
February 2026, fuel prices have risen sharply, along with the price of heating
oil (as covered in our earlier NISRIE report) and Liquified Petroleum Gas
(LPG). Transit of crude oil, LPG and refined fuels through the Strait of Hormuz
have been heavily disrupted and shipments have not reached markets, creating a
global supply shock.
Alongside seasonal fluctuations in petrol and diesel prices
over the last ten years, an upward trend in fuel prices from 2016 changed in
March 2020, with the onset of Covid-19 associated lockdowns and travel
restrictions. This resulted in a steep decline in the price of both petrol and
diesel (petrol falling to 104.9 pence per litre (ppl) and diesel to 111.7 ppl
in May 2020) as travel restrictions led to reduced demand for fuel. From June
2020 onwards, fuel prices began to rise again, with a marked increase in prices
from March 2022, after the Russian invasion of Ukraine, with petrol reaching
191.5ppl (a 28.4% increase) and diesel 199.2ppl (a 29.9% increase) in the first
week of July 2022. Prices then began to gradually fall, before starting to rise
more rapidly again from March 2026. Average petrol prices reached over 158ppl
in mid-April 2026 and again at the end of May, whilst diesel reached a high of
192.1ppl in the week commencing 13th April. Prices of both petrol and diesel
continued to fall from May until the beginning of July, remaining volatile as of August 2026.
As drivers experienced these price rises, the Office for National Statistics (ONS) reports that from March to April 2026, forecourt fuel
sales fell by 10.2%, the greatest reduction over the course of a month since
November 2020. ONS also noted that retailers reported drivers stocking up on
fuel in March and saving fuel in April 2026.
In rural Scotland, households are more likely to have two or
more cars compared with urban areas. Public transport options are more limited
in rural areas and longer travel times often necessary to access employment and
services. However, households with lower incomes are less likely to have access to a car, whilst the costs of running a car have a disproportionate impact on lower income households. This means that increased fuel costs will have a
greater impact on low-income households and particularly for those in rural
areas, where alternative public transport options may not be viable.
As highlighted by the Competition and Markets Authority(CMA), on average it is cheaper in the UK to buy fuel at a supermarket service
station compared with independent garages and branded forecourts. There are,
however, fewer options for drivers living in rural areas of Scotland to
purchase fuel at a nearby supermarket service station compared with those
living in urban areas. For example, based on analysis of Fuel Finder data using
the NISRIE peripherality classification, 30% of urban, 20% of island, and 19%
of mainland remote area service stations are at supermarkets, whilst 15% of
service stations in both mainland accessible and mainland very remote areas are
at supermarkets. The CMA notes there being less competition in rural areas, as well as higher transportation costs and lower fuel sales, leading to higher rural fuel prices.
Our analysis uses data from the UK Government’s Fuel Finder
service, focusing on 25 May 2026, to provide a snapshot of E10 and E5 petrol and
B7S diesel prices on this date and how they differed by where fuel was bought
across the country.
The full report can be downloaded by clicking on the link
below.