Chief Secretary to the Treasury Darren Jones has warned that global trade will continue to be hit for around eight months after the Middle East conflict is settled
UK families may still be suffering the economic consequences of the Iran war at Christmas, the government has warned.
Cabinet Minister Darren Jones said that global trade would face an eight-month lag in recovery even after the conflict is resolved. He assured that contingency planning for potential shortages was underway, and Britain was adequately prepared to tackle supply chain disruptions.
However, the Chief Secretary to the Prime Minister said: “I think our best guess is eight plus months from the point of resolution that you’ll see economic impacts coming through the system.”
This means that Brits might still feel the effects as late as December, even if the war were to end immediately.
The critical Strait of Hormuz remains blocked by both Iranian and US forces. Mr Jones said: “People will see higher energy prices, food prices and flight ticket prices as a consequence of what Donald Trump has done in the Middle East.”
He is chairing bi-weekly meetings to ensure Britain’s resilience in the face of economic turmoil and supply chain issues
Yesterday, Sir Keir Starmer urged Donald Trump to reopen the Strait during a phone call. No10 reported: “The leaders discussed the urgent need to get shipping moving again in the Strait of Hormuz, given the severe consequences for the global economy and cost of living for people in the UK and globally.”
It came as news emerged that the Iran war could send beer prices soaring due to the surging cost of essential brewing fuels and glass bottles.
Outgoing Heineken chief exec Dolf van den Brink said last week: “Global trade has become more complex and volatile, with impacts on energy availability and costs in certain markets. This leads to inflationary pressures, which might affect consumer sentiment in the medium-term.”
The beer giant, the world’s second-largest brewer, fears the escalating energy costs and inflation will worsen as the war rumbles on. It fears it will heap more pain on the sector which has suffered already with cost-of-living pressures and US tariffs.