Britain’s annual inflation rate climbed to 3.1% in August, its highest level since March, driven sharply higher by soaring petrol and diesel prices.
The figure matched economists’ expectations and marks the first time inflation has breached the 3% threshold in several months, intensifying pressure on household finances.
The Office for National Statistics said motor fuel costs were the primary driver of the spike, surging 23% year-on-year in August.
Average petrol prices rose by 9.1 pence per litre between July and August alone, pushing them to their highest level since November 2022, the ONS confirmed.
Diesel prices also climbed sharply, with the average cost rising by 14.2 pence per litre during the same period, adding further strain on motorists and hauliers.
British motoring body the RAC said petrol and diesel prices had hit levels not seen in four years since the Iran war began, with both fuels deeply affected by the ongoing conflict.
Crude oil prices hovering above $100 a barrel continue to fuel the surge at the pump, with no immediate signs of relief for consumers.
Inflation had already risen to 2.9% in July after a government-regulated energy price cap was revised sharply upward, signalling a worsening trend heading into autumn.
In August, the cost of electricity, gas and other household fuels jumped 6% year-on-year, the ONS confirmed on Wednesday, compounding the pressure on struggling households.
The UK, as a net importer of energy, remains particularly exposed to external energy shocks, leaving it vulnerable whenever global commodity markets experience significant disruption.
Britain is still battling a prolonged cost-of-living crisis that first took hold following post-pandemic inflation and the energy price surge triggered by Russia’s full-scale invasion of Ukraine in 2022.
The latest inflation data is likely to increase scrutiny on policymakers as they weigh how to respond to rising prices while supporting an economy under mounting financial stress.