UK Prices Could Stay High After Iran Conflict, Minister Says – Why Inflation Won't Fall Quickly

The United Kingdom government on Sunday warned that prices will stay high for a long time even after the war in Iran ends.

Energy, food, and transport costs have already risen, and officials say the effects will continue for months because global oil supply routes have been disrupted.

Chief Secretary to the Prime Minister Darren Jones said Britain could still feel the economic effects of the conflict for months even fighting stops in Iran.

He said people should expect a long period of impact, stating: 'I think our best guess is eight-plus months from the point of resolution that you'll see economic impacts coming through the system', the BBC reported.

'So people will see higher energy prices, food prices ... flight ticket prices as a consequence of what (US President) Donald Trump has done in the Middle East', he added.

This means that even if the war ends, prices may remain high for most of the following year.

Why Is The Iran Conflict Causing A Sharp and Wide Increase in Prices?

The main reason for rising prices is the war in Iran and disruption in the Strait of Hormuz, resulting in high energy costs around the world.

Even when oil prices stabilise, past increases continue to affect the economy.

The government says there will be no quick relief for households because supply chains remain under stress.

Jones also warned that the UK is more likely to face higher prices rather than empty shelves. This means goods should still be available, but at higher costs.

Recent figures show UK inflation has already risen to 3.3%, mainly due to higher fuel and transport costs linked to global energy shocks.

Rising Prices Not An Isolated Case in The UK But Around the World

According to the International Monetary Fund, global inflation is expected to go up slightly in 2026 before starting to fall again in 2027. The slowdown in economic growth and the rise in inflation are likely to be more noticeable in emerging and developing countries.

An analysis made by economists at Oxford Economics said that inflation could take two to three years before prices stabilise, similar to other instances in the past where war disrupted oil supplies.

UK Government's Interventions To Mitigate Effects of Price Increases

Ever since the war, the government has been conducting meetings and monitoring to step up its plan to mitigate the effects of price surges.

On Tuesday, Prime Minister Keir Starmer is set to chair a Cabinet committee meeting to look at possible shortages and how to address them. At the same time, a team of ministers is meeting twice a week to keep track of supplies and watch for any problems in the supply chain.

The government is also working with industries to prevent shortages of key materials, including carbon dioxide, which is important for food production, drinks manufacturing, defence, and medical uses.

In relation to this, the government has allocated funds to restart the Ensus bioethanol plant, which produces carbon dioxide as a by-product.

'We're acting now to prepare for - and mitigate where possible - the impact on our economy and domestic security as a result of the conflict', Jones said.