Prime Minister Sir Keir Starmer has convened an emergency meeting of the Cobra committee on Monday to discuss the economic fallout from the US-Israel war against Iran. The meeting, attended by Chancellor Rachel Reeves, Energy Secretary Ed Miliband, Foreign Secretary Yvette Cooper, and Bank of England Governor Andrew Bailey, will explore contingency measures to mitigate rising costs of living.
Speaking during a school visit in London, Starmer said the government would examine 'every lever that’s available' to help families cope with soaring energy prices and increased borrowing costs. However, Downing Street downplayed expectations of immediate financial support, indicating the discussions would focus on assessing the conflict’s economic impact, preventing fuel shortages, and combating profiteering.
The conflict, triggered by US and Israeli strikes on Iran, has led to Iran blocking the Strait of Hormuz—a critical route for oil and gas shipments to Europe—and launching missile and drone attacks. Economists have warned the disruption could rival the 1970s oil price shocks or the effects of Russia’s invasion of Ukraine.
In a potential de-escalation, US President Donald Trump extended his deadline to strike Iranian energy infrastructure by five days, citing 'very good and productive conversations' with Tehran. Downing Street welcomed any breakthrough, stressing the need to reopen the Strait of Hormuz. Starmer spoke with Trump on Sunday evening in a 20-minute call described as 'constructive.'
The UK has distanced itself from the conflict, refusing permission for US forces to use British bases for the initial attack and limiting support to strikes on Iranian missile sites. This has frustrated Trump, who has publicly criticised Starmer’s decisiveness. Starmer reiterated the need for de-escalation, saying, 'We defend our interests, we defend British lives, but without getting dragged into the war.'
