British finance minister Gordon Brown yesterday warned that the rise in petrol prices is as serious "as the oil shock of the 1970s" which sparked years of recession.
As fuel protestors prepared to mount a wave of demonstrations across Britain, Brown said he sympathised with hauliers and motorists on low incomes who have been hit by steep increases in the cost of fuel.
Lorry drivers planning to hold up traffic with slow-moving motor-way convoys yesterday warned the demonstrations would escalate unless the government took immediate action.
But Brown said he would not intervene to prevent the price of petrol rising further - although he hinted that petrol duty, which has already been frozen, would not increase in his mini-budget later this year.
He said Hurricane Katrina had exacerbated the crisis, but he thought a slump could be averted by maintaining stability in the British economy.
"I am aware of the challenge the hauliers face. I am aware, particularly, of the problems low-income families face with petrol prices rising," Mr Brown said on BBC Sunday AM.
"The public do understand that stability is all-important here and what we need to do is deal with an oil shock which is as big as the oil shock of the 1970s in terms of its effect on the economy."
Mr Brown has been talking with leading oil producers, including Saudi Arabia, to try to persuade them to increase production.
The British government fears a repeat of the chaos of 2000 when supplies were cut off, motorways were blocked and huge queues for petrol ensued after protests against the cost of fuel.
Contingency plans have been drawn up by the Department and Trade and Industry for rationing at petrol stations if supplies are blocked by lorry drivers over a long period.
Fuel protesters have rejected a call from the police to call off the action. But their leaders called on lorry drivers not to stage "blockades" urged the public not to panic.
Prices of standard unleaded petrol have reached up to £1 ($2.60) a litre, with the average price rising from around 80.2p a year ago to approximately 97p.