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UK faces eight-month price hike after Middle East war
British households could see elevated energy, food, and flight costs for at least eight months once the US-Israel conflict with Iran concludes, a senior government minister warned on Sunday.
Supply chain disruptions fuel economic strain
Darren Jones, chief secretary to Prime Minister Sir Keir Starmer, told the BBC that slowed or halted energy production and transport across the Middle East had triggered global supply chain issues. The government is now accelerating contingency plans to address potential food and fuel shortages.
Officials previously drafted a worst-case scenario projecting summer food shortages, including pork and chicken, if the conflict persisted. The International Monetary Fund (IMF) also revised its UK growth forecast downward to 0.8% for 2026, citing the energy shock as the hardest-hitting among advanced economies.
Government urges calm amid fuel and travel concerns
Despite the risks, Jones emphasized that price increases were more likely than empty supermarket shelves. He advised drivers to continue refueling as usual and not alter travel plans over fears of jet fuel shortages.
"Our best estimate is eight-plus months from resolution before economic impacts fully materialize. People will feel higher energy, food, and flight costs as a result of recent events in the Middle East,"
Darren Jones, Chief Secretary to the Prime Minister
CO2 shortages threaten food and drink supplies
A potential carbon dioxide (CO2) shortage, critical for food preservation and animal slaughter, has raised alarms. The government has funded the reactivation of the Ensus bioethanol plant to boost CO2 production, with the facility assuring it can meet demand "for the foreseeable future."
Jones acknowledged concerns about pubs running out of draught beer during the summer's Men's Football World Cup but insisted measures were in place to prevent shortages. Most UK CO2 is imported from Europe, often as a by-product of fertilizer production reliant on natural gas.
Industries and opposition respond
Supermarkets are collaborating with the government to prepare for worst-case scenarios, while the National Farmers' Union warned of rising cucumber, tomato, and milk prices over the next six months. Airlines, however, have dismissed immediate jet fuel shortages, citing advance purchases and stockpiled reserves.
The Liberal Democrats called for urgent action, proposing a 10p fuel duty cut and reduced public transport costs. Cabinet Office spokeswoman Lisa Smart criticized the government's response, stating, "People cannot afford these sky-high costs, and ministers must do more to help."
Strait of Hormuz remains flashpoint
Iran's chief negotiator declared reopening the Strait of Hormuz-vital for global shipping-"impossible" if the US maintained its naval blockade. The standoff has led some countries to ration fuel and airlines to scale back schedules. US President Donald Trump aims to pressure Iran by targeting its oil revenue and strait tolls, while Tehran has condemned the blockade as "piracy."
Negotiations in Islamabad on Saturday marked another attempt to de-escalate tensions, though no breakthroughs were reported.
