Rishi Sunak is thought to have axed a 2.8p fuel duty rise in his Budget - days before the UK hosts a global climate summit.
The Chancellor will reportedly hold fuel duty at 57.95p per litre for the 12th year in a row after prices at the pumps soared.
It will be a relief to hard-up motorists after petrol prices hit a record average high of 142.94p on Sunday, adding £15 to the cost of filling up a family car.
Oil prices have doubled from $40 a barrel a year ago to $85 – and some analysts predict it could hit $90 by Christmas.
The RAC warned we could “very easily” see petrol prices climb to 150p a litre this winter if oil gets to $100 a barrel.
But the Chancellor, who had been planning a 4.9% duty rise to 60.79p in 2022 according to the Sun, could face fury ahead of COP26.
World leaders will descend on Glasgow next week for the UN climate summit in a bid to keep global temperature rises below 1.5C.
Mr Sunak is already thought to have ditched plans to cut VAT on energy bills for hard-pressed households because of the message it would send ahead of COP26.
And Boris Johnson admitted this week he is “very worried” it “might go wrong” and end without the right agreement.
“It’s touch and go,” the Prime Minister said - hosing down expectations after he was criticised for setting them too high.
Analysis by Carbon Brief last year claimed years of fuel duty freezes had raised UK CO2 emissions by up to 5%.
Meanwhile, last year’s freeze alone will deprive the Treasury of £945million a year by 2025/26 - money that could otherwise be spent on public transport or cycling.
That is without the cumulative impact of the 10 years of freezes that came before it. IFS analysis has suggested freezing the duty up to 2022/23 would result in almost £14bn a year less for the Treasury, compared to plans the Tories first inherited in 2010.
The Treasury refused to comment on tax changes ahead of the Budget.
But the Prime Minister's official spokesman hinted yesterday that fuel duty could be frozen once again.
He said: "We recognise rising fuel costs are a challenge for the British public.
"We continue to provide support for those that need it on the cost of living."
Ahead of Wednesday's Budget, the spokesman would not be drawn on whether Rishi Sunak would increase fuel duty, adding to the burden on motorists.
Asked whether fuel giants should take a hit to their profits instead of passing on rising prices to drivers, the spokesman said: "We would always want to see providers ensure they are providing good value to their customers."
