This Is Why Will the Iran war worsen the cost of living crisis?
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Mar 3, 2026 
Ed Conway, Sky News economics and data editor with expertise in macroeconomics and energy markets, explains how the Iran conflict could reshape inflation and the UK economy. He discusses why Strait of Hormuz disruptions matter for oil, gas and fertiliser flows. He outlines scenarios from weeks-long disruption to prolonged conflict and how that could affect prices, bills and market volatility.
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Gulf Energy Concentration Creates Systemic Risk
- Global energy supply is concentrated in the Gulf so disruptions there quickly ripple through world markets.
- Ed Conway highlights the North Field and the Straits of Hormuz, noting 20–30% of global oil and large shares of gas and fertiliser transit that chokepoint.
Hormuz Disruptions Threaten Fertiliser And Food Prices
- Disruptions through the Straits of Hormuz affect more than fuel; they hit petrochemicals and fertilisers that sustain food supply chains.
- Conway warns 30–40% of global fertilisers pass through the straits, feeding China, Europe and beyond.
Short Term Gulf Shocks Can Reverse Rate Cut Plans
- Short-term closures of Gulf routes would raise inflation worldwide by making energy and inputs more expensive.
- Conway says even a few weeks of disrupted flows would upend expectations of near-term interest rate cuts by central banks.