Prime Minister Keir Starmer has warned that the longer the US-Israel conflict with Iran continues, the greater the likely impact on the UK economy, as oil prices surge and governments brace for energy supply disruption. Speaking on Tuesday, Starmer acknowledged that the conflict could push up inflation and squeeze household budgets, stressing the need for the government to assess risks and work with international partners.
Starmer insisted the UK economy remains resilient and revealed that Chancellor Rachel Reeves has been in daily contact with the Bank of England governor. However, he faces pressure from unions and some backbenchers to prepare a support package for businesses and consumers in case of sustained fuel price rises. The prime minister emphasised that decisions about Britain's best interests are his alone.
Finance ministers from the G7, including the UK and US, held a conference call to discuss the crisis as oil prices surged. UK motorists are already feeling the impact, with advice to cut non-essential car journeys. Downing Street played down suggestions that the aircraft carrier HMS Prince of Wales is being readied for deployment to protect Britons in the Middle East, though its preparedness has been increased.
Separately, the UK government announced it will comply with EU production and marketing laws in areas such as jams, cereals, frozen food, and cut flowers to simplify post-Brexit exports. This move is seen as a precursor to a sanitary and phytosanitary agreement ahead of the UK-EU summit in July. More than 16,000 businesses stopped exporting to the EU after Brexit, many in the food sector.
