Protesters give Blair 60 day ultimatum

Fuel protesters, ending their blockades of a number of Britain's oil refineries, issued a stark warning to the Government and demanded a meeting with the transport and agriculture ministers.

Fuel protesters, ending their blockades of a number of Britain's oil refineries, issued a stark warning to the Government and demanded a meeting with the transport and agriculture ministers.

The leader of the protesters at Stanlow in Cheshire, Brian Williams said that his ad hoc band of hauliers and farmers wanted to see a reduction in fuel tax within 60 days if the protests were not to start again.

"I hope the Government is going to respond with honour and integrity," he said, ending the week long blockade that started a dominoe effect around the country.

Prime minister Tony Blair held a special cabinet meeting at Downing Street this morning to discuss the crisis and the Government's response to it.

Military oil tankers were deployed on stand-by across Britain last night as Mr Blair was forced on to the back foot just 24 hours after predicting the country's worst petrol shortage since the Seventies would start to ease.

With the NHS on red alert, supermarkets talking of food rationing and only a fraction of fuel deliveries having been resumed, Tony Blair appeared to have misjudged the determination of protesters and the reluctance of tanker drivers to cross picket lines. He said neither the recall of Parliament nor the use of the Army had been ruled out.

Within hours, the Ministry of Defence announced that 80 fuel lorries operated by the Army, Navy and RAF were being deployed overnight to strategic points across the country as a "precautionary measure".

Admitting the severity of the crisis, Mr Blair said: "There is a real danger now for the NHS and other essential services. Lives are at risk."

While the Prime Minister took some comfort that 650 fuel deliveries had been made yesterday, he conceded there was still a "considerable" way to go before the position got back to normal. Despite having invoked emergency powers on Tuesday to force oil companies to restart deliveries, only a small fraction of the 3,000 tankers that normally leave Britain's refineries every day were operating.

Most of those that did leave were bound for designated petrol stations, serving only the emergency and priority services. Where the public was able to buy petrol, there were chaotic scenes and long queues of angry drivers.

Virtually every petrol station not designated to receive emergency supplies had run out of fuel last night. Total said all of its 1,400 outlets had run dry while only 30 of Shell's 1,100 forecourts had petrol. Esso said the "vast majority" of its 1,620 stations were closed, as were 1,100 of the 1,500 run by BP. Texaco said all but 150 of its 1,500 forecourts were shut.

Sainsbury's chief executive, Sir Peter Davis, signalled growing concern among supermarkets over food supplies by writing to Mr Blair last night to say the chain's stocks would be exhausted in "days rather than weeks".

In what was seen as an attempt to drive public opinion against the fuel rebellion, Mr Blair said the demonstrators were doing real damage. His claim was backed by the Confederation of British Industry, which warned that firms were already cutting production and laying off staff.

The Prime Minister said the blockade would prevent nurses and doctors from getting to work. The National Blood Service denied an immediate crisis with supplies but said later that it was "on alert". Mr Blair predicted the public would question the validity of the protests now the consequences were becoming clear.

Alan Milburn, the Secretary of State for Health, warned that the problems in the NHS would get worse by the hour. "The situation is rapidly deteriorating. I am afraid that slowly but surely the NHS is going to grind to a halt."

The military tankers, part of a dedicated fuel distribution system operated by the armed forces, were moved to locations close to hospitals and other essential services. An MoD spokesman said: "They are being deployed, not employed. They have not yet been authorised to supply fuel."

Ministers announced red diesel, normally restricted to agricultural use, could be used for other vehicles where companies already had stocks. The Government was also considering recalling Parliament from its summer break for an emergency debate on the fuel crisis - a move demanded by the Tory leader, William Hague.

Although allies insist Mr Blair could ride out the storm by showing strong leadership, they were worried the crisis will damage his credibility. The Prime Minister hoped that a no-compromise position would see him through and warned that giving in to "pickets, intimidation, violence and blockades" would not only damage the credibility of the Government and him personally but that of the whole country. "We will listen," he said, "but we will not be intimidated."

Mr Blair put strong pressure on the oil companies to move more quickly when he met industry leaders at Downing Street. But officials conceded that drivers were still facing intimidation away from their workplaces. The Freight Transport Association said drivers who took out lorries were being warned by protesters that their photographs would be posted on the internet.

Despite assurances from police that they could ensure safe passage from every depot, the main oil companies said they were not satisfied that their drivers' safety was guaranteed.

Some cabinet ministers are privately blaming the continuing crisis on Gordon Brown's refusal to make a promise now to freeze or cut fuel duties in his next Budget. Allies said the Chancellor was unlikely to give such a pledge when he unveiled his draft Budget in November, and Mr Blair has said it cannot be turned into an emergency Budget.