Petrol Prices Uk Set to Bite Households as Iran Conflict Raises Costs
Monday at 9: 14 a. m. ET — Drivers, low-income households and small businesses in southern England are already paying more at the pump and facing tighter budgets after the Iran conflict pushed crude prices higher; the RAC estimates the move has added 3p to a litre of unleaded and sharpened worries about household bills.
RAC Warning on petrol prices uk Hits Low-Income Households
The RAC estimates the immediate hit to pump prices has already translated into a 3p rise per litre of unleaded across the UK, a change that hits poorer households hardest. Economists at the University of Massachusetts Amherst found energy, along with food and agriculture, has “a disproportionate capacity to increase inequality when their prices rise, ” and research referenced in the context shows that after a past oil surge, half the windfall benefits went to the wealthiest 1% while the bottom 50% received only 1%.
Tom Hayes, Damian Hinds and Zoe Franklin Warn of Local Economic Strain
MPs including Tom Hayes, Damian Hinds and Zoe Franklin told local audiences that the deepening conflict in Iran and the wider Middle East could threaten economic stability across southern England by pushing up fuel, energy and business costs. Crude oil prices have risen by 27% since the conflict began, and the closure of the Strait of Hormuz has been flagged as a key channel driving those increases.
Bank of England, Oil at $90 and Wider Supply Risks
Markets pushed oil to $90 a barrel after the Strait of Hormuz was effectively closed and reports of production cuts emerged, and analysts warned oil could breach $100 a barrel within days if disruption continues. That sharp move raises costs beyond fuel: the conflict’s impact on oil affects fertiliser production and creates knock-on pressures for manufacturing and transport, amplifying inflationary forces that the Bank of England is watching closely.
Still, the Bank of England is expected to pause further interest rate cuts in light of upward inflationary pressure tied to the conflict, a stance MPs say could limit the government’s room for manoeuvre on household cost relief.
If wholesale gas and oil costs remain elevated, household energy bills could rise sharply when the next quarterly price cap takes effect in July.
