Will the government offer help as Iran conflict threatens to push up bills?

As the Iran war leads to a surge in oil prices, it’s possibly just a matter of time before we feel the effects in our pockets.

From petrol and energy bills to food prices, many essentials could soon become much more expensive.

So many of us are wondering what help the government will or might offer.

Well, chancellor Rachel Reeves has now spoken in parliament to outline what’s being done.

Iran war could have a wider economic impact

The Bank of England is predicting that inflation could rise to between 3% and 3.5% in the coming months.

While that’s not significantly higher than where it is now, it does suggest it could remain above its 2% target for longer – just when hopes of inflation easing were starting to grow.

“The full economic impact of the war remains uncertain,” the chancellor said.

Because of this uncertainty, she says the government is preparing to take further action to “bear down on the cost of living".

Targeted energy support possible

Apart from taking steps to improve the UK’s energy security, such as investing in renewables, the government is looking at what direct help it can offer to households.

“Contingency planning is taking place for every eventuality so that we can keep costs down for everyone and provide support for those who need it most,” Reeves said.

This suggests that if any relief scheme is introduced, it won’t be universal.

The chancellor also pointed to steps that have already been taken to help households with energy costs, such as:

• £53m support for heating oil users
• £150 off energy bills from next week
• the energy price cap not going up in April

“I know that families are worried about the impact of rising prices,” the chancellor said.

“I have said that we will be responsive to a changing world and responsible in the national interest.”

“We don’t yet know what the full impact of this conflict will be.

“So we must be agile in responding appropriately at each moment.”

Reeves to meet with supermarkets and banks 

Soaring oil prices push up costs across the board, so the chancellor is meeting with major supermarkets and banks later this week to discuss how they can support customers.

She also confirmed that the Competition and Markets Authority (CMA) is stepping up its monitoring of fuel prices, as well as keeping a close eye on the cost of household essentials for both price rises and disruption.

Reeves said the CMA has also launched a market study into heating oil, and that it will be given new powers to "detect and to crack down on price gouging".

"This government will not tolerate any company exploiting this crisis at consumers' expense," the chancellor insisted.

Helping households with the cost of living

Reeves also pointed to other steps the government has taken to reduce the cost of living, such as:

• 30 hours of free childcare to working parents
• free breakfast clubs in primary schools
• ending the two-child benefit cap
• a rise in the national living wage
• prescription charges frozen
• train fares frozen

Try our household bills calculator

Global events can feel out of your control - and we understand that.

So if you’re worried about bills and want to regain a sense of control, it can help to see the bigger picture.

Our free and interactive household bills calculator gives you a personalised forecast of how your monthly costs could change.

It only takes a couple of minutes to use and shows how bills may change based on where you live.

Once you’ve done this, you can take the next step by using our handy budget planner to map out your monthly finances. 

It’s free and easy to use.

And if you’re struggling to keep up with household bills, remember that you might be entitled to some support.

We can check you’re getting all the benefits you’re eligible to claim with our benefits calculator.