Chancellor Rachel Reeves has accused petrol retailers and heating oil companies of price gouging as Middle East tensions push up UK energy costs. Reeves said some petrol stations were charging 180p per litre while others charged less than 130p, calling for immediate price reductions at the pumps.

Her comments come as the Treasury faces growing pressure to intervene in energy markets. The previous Conservative government spent nearly £80bn on household and business support after the Ukraine war, but Reeves is determined to avoid another costly state bailout. The chancellor has asked the Competition and Markets Authority to investigate whether consumers are being exploited.

Industry representatives pushed back against Reeves' claims, arguing that different supplier arrangements and rising wholesale costs explain price variations. Heating oil suppliers say they're buying at much higher prices due to Middle East supply disruptions, with about 1.5 million UK homes affected. Meanwhile, economic forecasts suggest the Iran conflict has already derailed Reeves' growth projections, with the British Chambers of Commerce now predicting slower growth and higher unemployment for 2026.