Rising fuel costs are having a "dramatic" effect on the economy, with most smaller firms warning it will be difficult to recruit staff in the coming year, according to a new report.
The Federation of Small Businesses (FSB) said a survey of 9,000 firms showed four out of five were worried the cost of fuel would hit their expansion plans.
The business group said the findings made "worrying reading" and called on the Government to use higher than expected tax revenues from North Sea oil to cut fuel duty.
FSB chairman John Wright said: "Small businesses are reaching breaking point and if something is not done about rising fuel prices very quickly then we will have a major economic crisis on our hands.
"The UK's 4.5 million-strong small business community simply cannot cope with the cost of fuel rising at these rates. The problem is affecting every type of business in every area of the country.
"The most frustrating thing is that the Government can do something about it.
"Its estimate of the cost of North Sea oil in the last Budget was well below the actual cost, which means that tax revenues have been well above expectations.
"Why can't they use this extra money to reduce fuel duty and ease the pain for the millions of small businesses that keep the UK economy afloat?"
