US Offensive in Iran Drives Sharp Rise in UK Fuel and Energy Prices
What happened
Since the start of the US offensive in Iran, average unleaded petrol prices in Scotland have increased by 40p a litre, reaching 172.85p a litre. Diesel prices have climbed by 54.5p to 196.89p a litre. Thomas Pugh, Chief Economist for RSM UK, stated that the sharp rise in wholesale energy markets risks triggering a broader inflation shock.
From heraldscotland.com
Why it matters
The surge in energy costs, including natural gas prices that have almost doubled and oil prices that have risen by around 50%, represents an immediate hit to disposable incomes and operating costs in Scotland. If current increases persist, utility bills could rise by a further 25% in January.
From heraldscotland.com
Who's involved
- Thomas PughChief Economist for RSM UK, providing economic analysis on the price hikes.
- RSM UKUK business providing economic analysis and warnings regarding market consequences.
- ScotlandGeopolitical state experiencing immediate pressure on disposable incomes and operating costs.
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- ScotlandSpeculative
Hauliers, manufacturers, food producers, hospitality businesses, and rural communities might face increased operating costs due to rising fuel prices.
- inflationSpeculative
Inflation might be driven upward sharply by energy price hikes and supply chain costs.
- BankSpeculative
Rising energy costs and inflation could increase pressure for interest rate adjustments by the Bank of England.
- Bank of EnglandSpeculative
An inflation shock from energy prices could increase pressure for the Bank of England to raise interest rates.
Keep exploring
The entities involved
-
RAC
Mexican appliances, computers, cell phones
-
RSM UK
UK business
Nothing else this week.
-
Thomas Pugh
chemist
Nothing else this week.