Keir Starmer has said that a long-term US-Iran war would affect the \u201clives and households of everybody\u201d, as the head of the AA advised motorists against making \u201cnon-essential\u201d journeys.<\/p>\n
On Monday, oil prices surged past $100 (\u00a375) a barrel for the first time since 2022, which will feed through to higher costs at petrol stations, and consumers will also be hit if energy costs push up inflation.<\/p>\n
Ministers are understood to be looking at ways to potentially mitigate the rising costs on energy bills \u2013 and are likely to come under pressure to cancel a planned 5p rise in fuel duty this autumn.<\/p>\n
Speaking as he launched the government\u2019s community cohesion plan, Starmer said: \u201cThe job of government is obviously to get ahead, to look around the corner, to work with others, and the chancellor speaks to the governor of the Bank of England on a daily basis \u2026 assessing the risks, monitoring and talking to our international partners as well about what more we can do together to reduce the likely impact on people here and businesses here, of course.<\/p>\n
\u201cBut it is important to acknowledge that work is needed, because people will sense \u2026 that the longer this goes on, the more likely the potential for an impact on our economy, impact into the lives and households of everybody and every business.<\/p>\n
\u201cAnd our job is to get ahead of that, to look around the corner, assess the risk, monitor the risks, and work with others in relation to that.\u201d<\/p>\n
Edmund King, the president of the AA, said drivers should \u201cnot change their refuelling habits\u201d but could \u201cconsider cutting out some non-essential journeys and changing their driving style to conserve fuel\u201d.<\/p>\n
Simon Williams, the RAC\u2019s head of policy, said pump prices had \u201crocketed\u201d in the last week. \u201cPetrol is up 5p to 137.5p and diesel up 9p to 151p a litre since the current crisis began,\u201d he said. \u201cUnleaded is almost certainly going to reach an average of 140p in the next week or so while diesel looks highly likely to climb to at least 160p a litre.\u201d<\/p>\n
<\/p>\n Most UK households will be protected in the short term by the energy price cap, but the UK\u2019s reliance on gas from the Middle East makes it especially vulnerable to an effective blockade of the strait of Hormuz, through which about 20% of the world\u2019s liquid natural gas is transported.<\/p>\n Starmer said the UK economy was in a stronger place than in 2022 when the war in Ukraine contributed to a surge in energy prices and overall inflation.<\/p>\n He said: \u201cWe\u2019ve done a lot of work in the last 18 months to put some resilience in and make sure that we\u2019ve got some headroom, which is basically some insurance within the economy, but also inflation is 3% and going down, so in that sense there\u2019s more resilience.\u201d<\/p>\n The prime minister\u2019s statement followed a senior minister insisting that there was no immediate threat to energy supplies in the UK despite rising oil prices.<\/p>\n The impact of US-Israeli airstrikes in Iran, and retaliatory attacks from Tehran elsewhere in the region, was \u201cclearly very concerning\u201d, said Steve Reed<\/a>, the communities secretary. \u201cThe government will be keeping a very close eye on the situation with oil prices. We\u2019re monitoring that regularly. I don\u2019t think that there is cause for undue alarm yet.\u201d<\/p>\n Fuel prices had \u2018rocketed\u2019 in the last week, said the RAC. Photograph: Neil Hall\/EPA<\/p>\n There were, he added, sufficient supplies remaining of oil and gas. Government sources dismissed as incorrect a report in Monday\u2019s Times<\/a> claiming the UK had only two days of gas supplies.<\/p>\n