US Diesel Export Ban Could Send UK Inflation Soaring

A potential US ban on diesel exports could push UK inflation near 5% due to its heavy reliance on imports, economists warned. The average pump price of diesel in the UK has already topped £2 per liter for the first time.

Forecasters predict that a prolonged export ban would drive prices up to £3 and add as much as one percentage point to UK inflation, strengthening the case for Bank of England interest-rate hikes.

The US administration has hinted at imposing an export ban unless European nations release stockpiles to control prices. The G7 countries plan to release up to 100 million barrels of diesel and oil over the next four months to ease market strains.