The ongoing Gulf crisis has impacted the energy markets in the UK economy, with oil prices surpassing $100 a barrel.
For people investment planning in Cheshire, Oswestry and across the UK, there will be concerns about what the wider economic impact will mean, following the greatest disruption to energy since Russia’s 2022 invasion of Ukraine.
Commenting on the current crisis, chief investment strategist at wealth manager Evelyn Partners, Daniel Casali, said that oil supply and production had been reduced by countries in the region, with the Strait of Hormuz transit routes and oil and gas infrastructure all under threat of attack. As such, the cost of brent crude oil has risen by approximately 50% over the last week.
Other analysts have reaffirmed the need for calm, suggesting that the shock will be ‘temporary’ before events and the markets stabilise. With commodity prices actually higher than in the futures market, that could mean that in the longer term, barrels delivered in 2027 end up cheaper.
The most immediate impact on UK customers is being felt at the pumps, with prices of petrol and diesel both continuing to climb since the crisis began. With prices predicted to rise to 140p for unleaded and 160p for diesel, motorists are being urged to shop around forecourts for the best deals.
The potential for an inflationary spike is likely to kill off any further Bank of England interest rate cuts in the short term, although the current consensus amongst economists is that they are likely to hold steady rather than go back up.
