Prepare for driving restrictions and four-day working weeks as Iran crisis deepens, warns former BP executive

A former oil company executive says ministers should consider enforcing driving restrictions amid an impending fuel supply crisis.

Nick Butler, former BP head of strategy and a policy advisor to ex-PM Gordon Brown, said limiting drivers to alternate days based on their vehicle’s registration number would be one measure.

Another would be for employers to allow an extra day off for staff every week to reduce commuter traffic.

He urged the Government to reassure people by telling them ‘what was going to happen’ if the Iran war dragged on.

‘If supplies are cut by 20 per cent, then someone is using 20 per cent less,’ he said.

‘The Government has to protect the key sectors of the economy – food supply, health service, schools and so on – and then it has to work out how it’s going to manage the market for the rest of us.

‘I don’t think they can just leave it to a free-for-all, which would be chaotic and very regressive and unfair to those of limited ability to pay.

‘I don’t think it’s going to be ration books. 

‘A lot of countries around the world are now beginning to look at how to gently reduce consumption – driving alternate days for different registration numbers, having an extra day’s holiday a week – that’s what some countries in the Far East are doing.

‘Those sort of measures are a form of rationing that will constrain demand to bring a new balance with supply.’

He told BBC Radio 4’s Today programme that the squeeze on fuel would not be resolved quickly – even if political agreement was reached.

‘There is real damage to facilities and supplies,’ he said. ‘Some refineries have been knocked out, the gas terminal in Qatar has been knocked out and that will take a long while to put back into order.

‘So we’re going to have a problem over quite an extended period.’

Mr Butler, a visiting professor at King’s College London, said ministers needed to maximise production of the UK’s North Sea oil, although this was not an immediate solution.

Meanwhile, consumers should be protected against price-gouging by fuel suppliers through ‘forensic audits’ of company accounts.

‘The Government should be setting out a plan now to manage really serious potential shortages which could develop if this conflict goes on and [the Strait of] Hormuz isn’t opened pretty soon,’ he added.

‘The risk is panic buying, which would be terrible. The Government has a responsibility to calm the market by showing how they are going to cope with this situation.’

Meanwhile, small petrol stations are being forced to close their pumps rather than charge £2 per litre as supermarkets warn of ‘tight’ supplies amid the war in Iran. 

As the conflict between Tehran and the US and Israel entered its second month on Saturday, consumers and businesses are feeling the pinch of spiralling fuel prices.

Queues continue to mass at petrol stations across Britain with short-term supply issues in some areas since Iran closed the Strait of Hormuz, which typically sees 20 per cent of the world’s oil supply pass through it each year.

On Saturday, the conflict showed no sign of abating as the Houthi rebels in Yemen entered the war with a ballistic missile strike launched towards Israel. 

Experts now fear that the Houthis could close the Suez Canal. 

The latest development raises concerns that prices could spike even further if the Houthis resume their previous strikes on shipping in the Red Sea.

This week, some small petrol station owners shut up shop rather than be forced to charge customers up to £2 per litre for fuel. And at leading supermarkets, some pumps were closed as supplies simply ran out.

Forecourt bosses say they have been accused of ‘profiteering’ from the crisis – which the industry has firmly denied – by the Government and are facing abuse from angry customers.

Smaller forecourts are typically the first to be hit by rising prices, and many are choosing to close rather than have to pass on the astronomical price rises to customers.

Today, average petrol prices hit 150.11p per litre, while diesel rose again to 177.68p.

Mollie Ellis, who runs her family business Youlgrave Garage in the Derbyshire Dales, told how she shut the pumps two weeks ago after refusing to pass on higher prices to her customers.

Ms Ellis told the Times she was faced with charging customers 180p per litre of petrol and 200p per litre of diesel – something she was not prepared to do.

She stopped selling fuel on March 13, not wanting to face allegations of profiteering from angry customers or buy fuel at a loss that she couldn’t then sell.

‘We can’t afford to take that hit. We’re a one-mechanic garage,’ she said. ‘I don’t want to be at a point where I’m being seen to rip customers off, and people think that we’re profiteering, because a lot of colleagues in the industry are getting so much abuse.’

Beth Ballard, who runs a forecourt at H Ballard & Son car showroom in Welshpool, stopped selling petrol on March 19.

The last straw for her was being quoted a wholesale price of more than 150p per litre before any tax or operating costs, while her competitors’ prices were below 140p.

She said: ‘We are normally praised for being the cheapest in Welshpool, so it was just a big fat no. We’re not going to do that.’

Independent fuel stations are more likely to have fuel purchase agreements which see them buy based on the previous week’s, or even day’s, prices, than rivals such as supermarkets.

This means they are more vulnerable to market volatility and tend to be the first to have to pass on large price rises to customers.

Elsewhere, more than two dozen US troops have been wounded in Iranian strikes on a Saudi air base in the past week, sources have said, including 15 in an incident at the Prince Sultan air base on Friday.

Strikes continued across the region overnight, including in Iran, Lebanon, Israel and Bahrain.

Israel has threatened to escalate strikes on the Islamic regime, while US President Donald Trump yesterday hinted he was considering sending troops into the region – something Iran warned would see them exact a heavy price.

Trump also threatened to abandon Nato after his European allies declined to intervene to help reopen the Strait of Hormuz.

Trump said the US does not ‘have to be there for Nato’, in his latest comments, hitting out at his allies for not joining in his and Israel’s war on the Islamic Republic.

Speaking to an investment forum in Miami on Friday night, the President said he was upset that European Nato countries had declined to provide material support to the US as the conflict entered its second month.

‘We would have always been there for them, but now, based on their actions, I guess we don’t have to be, do we?’ he told the audience.

‘That sounds like a breaking story? Yes, sir. Is that breaking news? I think we just have breaking news, but that’s the fact. I’ve been saying that. Why would we be there for them if they’re not there for us? They weren’t there for us.’

European allies were not consulted by the US on its decision to attack Iran late last month, and many leaders in the alliance opposed the action.

It comes as the White House continues to give mixed messages about their intentions in the conflict, with Trump flitting between claims that the war is all but won and threatening major escalation, possibly even troops on the ground.