The escalating conflict involving the United States, Israel and Iran could have consequences far beyond the Middle East. Because the region is central to global energy supplies and key shipping routes, the crisis may eventually influence everyday expenses — from fuel and heating bills to food and travel costs. Here are six ways the conflict could impact consumers.
1. Petrol and diesel prices are rising
Fuel prices began climbing soon after the conflict erupted, largely because oil and gas production and transportation in the region have slowed or been disrupted. In the UK, petrol cost an average of 132.14p per litre and diesel 142.15p last Monday, according to government figures. Since the conflict began, RAC data shows petrol prices have increased by 4.68p to 137.51p, while diesel has jumped 8.59p to 150.97p per litre.
In the United States, petrol prices rose from $2.94 to $3.02 per gallon, while diesel increased from $3.81 to $3.90. However, these rises remain smaller than the dramatic increases seen in 2022 following Russia’s invasion of Ukraine, when UK petrol prices surged by more than 43p per litre within four months.
2. UK gas prices have surged
Gas prices in the UK have more than doubled since the conflict began.vBefore the crisis, benchmark gas prices were below 80p per therm. They briefly reached 171p before easing back to around 156p per therm.
Although this is far below the 600p peak reached during the 2022 energy crisis, prolonged high prices could still push household energy bills higher.vFor now, consumers are protected by the UK’s energy price cap, which remains fixed until July. But if gas prices remain elevated, the cap could increase later in the year.
3. Shipping disruptions could raise prices later
The conflict has also disrupted shipping through the Strait of Hormuz, one of the world’s most critical trade routes. After Iran threatened to target vessels, traffic through the strait has almost halted, leaving roughly 200 oil tankers stranded.
At the same time, insurance costs for ships linked to the US, UK or Israel have soared. The cost of chartering a supertanker to transport oil from the Middle East to China recently exceeded $400,000 per day, nearly double the price from the previous week.
Because most global goods are transported by sea, rising shipping costs can eventually push up consumer prices. According to the IMF, these increases may take months to reach store shelves, often peaking around a year later.
4. Fertiliser prices are climbing
Fertilisers are essential for modern agriculture, and the Middle East plays a key role in producing ingredients used to make them.
With shipping through the Strait of Hormuz disrupted and natural gas supplies threatened, fertiliser markets have already reacted.
The price of urea fertiliser in the US climbed to $578 per tonne, an increase of almost 25%.
Production cuts have also contributed to the rise. QatarEnergy, one of the world’s largest gas exporters and a major fertiliser producer, recently halted production after reported military attacks on its facilities.
Higher fertiliser prices could eventually translate into higher food costs, although experts say it is still too early to know how significant the impact will be.
5. Flight tickets may become more expensive
The Gulf region supplies roughly half of Europe’s jet fuel, meaning airlines are highly exposed to disruptions in the area.
Since the conflict began, the European benchmark price for jet fuel has nearly doubled from $830 per tonne to over $1,500.
Fuel accounts for around 20–40% of airline operating costs, so rising prices may lead to higher ticket prices or even flight cancellations if shortages occur.
However, the impact will vary. Airlines such as British Airways and EasyJet often lock in fuel prices through long-term contracts, while some major US carriers buy fuel on the open market and may face more immediate cost increases.
6. Inflation could remain higher for longer
Inflation had been gradually falling in many economies before the conflict began.
In the UK, inflation dropped to 3% in February, and the Bank of England had expected it to reach its 2% target as early as April. In the US, inflation stood at 2.4%, while the Eurozone was forecast to reach 1.9%.
But if energy and transport costs continue rising because of the war, inflation could increase again.
That may make central banks less willing to cut interest rates, meaning borrowing costs — including mortgage rates — could remain higher for longer. On the other hand, higher rates could also lead to better returns for savers.
