Fuel fears grow in UK as oil shortage threatens price inflation

Like an estimated 1.5 million UK homes, Annie Jones' house in south-west England has an oil tank. It fuels both her heating and hot water.

But the community oil-buying scheme that she's part of was suspended when the Iran conflict broke out. No suppliers will quote a firm price, for fear of wild fluctuations before they deliver.

In such a volatile market, it's leaving huge questions about the cost.

"They won't give you a price when you first order it, the price will be on the day they deliver it, and they're saying two to three weeks' delivery," she tells CGTN. 

I would have been paying about 55p [$0.73] a liter but I know neighbors of mine paying about £1.30 [$1.72], so yes, everything is getting more and more expensive and perhaps we have to get used to that."

For those not reliant on oil tanks, with price fixes and national caps on costs, bills haven't gone up… yet. There are warnings of significant rises in the coming months.

The UK government has promised to step in if prices spiral, but finance minister Rachel Reeves warned that support will be limited for the sake of the wider economy. 

"Contingency planning is taking place for every eventuality," Reeves told parliament, "so that we can keep costs down for everyone and provide support for those who need it most, acting within our iron-clad fiscal rules to keep inflation and interest rates as low as possible."

A month after it started, the conflict in Iran has had a huge financial impact on many in the UK. Petrol prices are up by about 11% in the last month. Diesel is up around 20%.

The average fixed two-year mortgage rate has jumped to almost 5.5% as fears linger over inflation, and possible interest rate rises by the Bank of England.

It's that uncertainty over future prices that's causing concern over household bills. Even before the Iran conflict, the latest figures showed more than two million UK households were in debt to their energy suppliers. Charities are now warning many more are having to cut back on essentials, to make ends meet.