Rachel Reaeves talked about Iran war’ ‘cost to British families and businesses’ (Image: Leon Neal, Getty Images)
The Iran War will come at a cost to “British families and businesses”. Those were the stark words of Chancellor Rachel Reeves as the conflict in the Middle East continues.
As previously reported, the UK was set to feel the knock-on impact of the war after the start of the US-Israeli strikes on Iran six weeks ago, with Iran’s stranglehold on the vital Strait of Hormuz causing fuel and oil costs to rocket. A hoped-for peace deal is off the cards for now after news this Sunday that talks between the US and Iran have stalled.
Britain is set to host talks on reopening the strait with a coalition of countries next week, reports The Express. The meeting is a continuation of Government efforts to restore freedom of navigation in the strait.
Prime Minister Keir Starmer has spoken to US president Donald Trump about the need for a “practical plan” to allow ships to proceed through the shipping lane, amid suggestions that Iran wants to charge vessels for passage, and Ms Reeves says it is crucial that the current ceasefire holds. She has said that although the scale of the costs is not known, the Government is committed to providing support to those who need it.
Writing in The Times, the Chancellor said: “I am going to be straight with people. The war in Iran will come at a cost to British families and businesses.
“These are not costs I wanted but they are costs we will have to respond to.” She added: “As Chancellor, I have vowed that my economic approach to this crisis will be both responsive to a changing world and responsible in the national interest.
“We don’t yet know the full scale of those costs but the immediate priority must be to ensure that the ceasefire holds. That is the best protection we have against higher costs at home and at the IMF (International Monetary Fund) meetings in Washington this week, I will be working with allies on the action we can take to guarantee freedom of navigation, including the Strait of Hormuz, to keep energy supplies moving again.
“But I know rising prices are being felt now. So, we are taking action to keep costs down for families and provide support for those who need it most.”
With gas prices rising sharply due to the effective closure of the strait, through which 20% of the world’s oil is normally transported, she said: “I know that rising energy bills are not only felt by households. They are felt by business too, including the UK’s manufacturing sector that has faced uncompetitive energy prices for too long.”
She added: “So later this week I will be setting out the next phase of our plans to boost Britain’s competitiveness. I will also set out the principles that will guide how we support businesses in the months ahead.”
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