UK gas prices soar more than 20%

With the latest attacks on both Iranian and Qatari natural gas facilities it looks more likely that government will step in on energy costs as the commodity soars over 20% this morning alone. That means more government borrowing and higher inflation- also higher gilt rates which feed through into what you’re paying on your mortgage. The joys of Trumps ill thought through, illegal attack on a sovereign country keep coming. If there’s no deescalation in the coming two weeks the oil price could reach $200 per barrel and that could mean £2 per litre. Mix these ingredients together and you bake a recession pie, with plenty of job losses and a housing market crash on the side!

This is not a minor development, it marks a clear shift into a more dangerous phase for the global economy. By targeting energy infrastructure, the conflict is now directly disrupting the flow of oil and gas that underpins economic activity. The sharp rise in prices reflects this. Energy feeds into almost every cost in the system, from transport to food production. If disruption continues, the impact will not be limited to higher bills—fertiliser shortages and rising food prices are likely to follow, adding to inflationary pressure. At the same time, higher energy costs tend to push bond yields up, increasing strain on an already heavily indebted financial system. Policymakers may respond with more intervention, but that risks weakening pound and prolonging inflation. If this persists, significantly higher energy prices are entirely plausible. A sustained fall in prices would require stability to return, but even then, underlying risks suggest volatility is likely to remain elevated.

As Qatar provides 20% of the world’s LNG, the targeting of its LNG hubs by Iran shifts the Middle East conflict from regional warfare to a direct assault on the global energy supply, creating a "risk premium" that threatens a global recession and, if the disruption lasts months, potentially a global depression. In the UK, this could lead to industrial shutdowns and a massive spike in food inflation via fertilizer costs. Gas prices could test the post-Russian invasion of the Ukraine, in 2022 record of 400p per therm with oil risks heading towards $150 bbl. if the Strait of Hormuz remains compromised. This isn't just a price spike; it is a systematic threat to global economic stability that demands a unified geopolitical response. In addition, the UK must reopen its domestic North Sea oil and gas production which could provide 40% of our domestic gas needs.

Gas up 23% in a single morning. Oil past $113. Strikes on Qatar's main gas hub put one of the world's biggest LNG suppliers in the firing line, and every therm of that disruption lands on your household budget.When energy infrastructure becomes a target, the cost hits everything: mortgages, food, fuel. If the government steps in again on bills, that means more borrowing, higher inflation, and gilt yields pushing mortgage rates up further. If this drags on, gas could retest the 2022 highs near 400p per therm and oil could push past $150 a barrel. That is recession territory.