OIL prices are at their highest point in seven months as Donald Trump weighs up striking Iran again as experts warn the consequences would be inflation and petrol costs going up.
Trump is still hoping for a diplomatic resolution over Tehran’s nuclear programme – the US and Iran are currently in talks in Switzerland.
The US moved a second battleship into the region this week and the US media is reporting that Trump had discussed attack options with advisers, and that a US strike could take place as early as Saturday.
Last summer the US military launched strikes on three Iranian nuclear facilities.
Experts have warned that oil prices are now at their highest level since July 2025 at over $70 a barrel and further strikes on Iran by the US would potentially push that towards $110 a barrel.
This would lead to higher petrol prices at the pump, higher inflation, and potentially mean higher gold prices, experts claim.
Inflation is now at 3% in the UK, down from 3.4%, in positive figures released yesterday. But this could be under threat if the world becomes more unstable, experts fear.
An energy price spike would reignite inflation
Tony Redondo, Founder at Newquay-based Cosmos Currency Exchange, said inflation and petrol prices in the UK will increase if Trump goes ahead with an attack.
He added: “Brent crude oil prices have already surged past $71 a barrel, their highest level since July 2025, after Iran obstructed the Strait of Hormuz, a chokepoint for 20% of global oil, yesterday, and a more permanent disruption of traffic could push crude prices past $110 per barrel.
“This would immediately end the recent downtick in UK petrol prices, as retailers pass on costs to motorists. Beyond the pump, an energy price spike would reignite inflation, potentially forcing the Bank of England to maintain high interest rates.
“The ‘second-round effect’ means higher transport costs for food and goods, slowing global GDP growth. While diplomatic talks in Switzerland still offer a slim hope for de-escalation, the military buildup suggests a shift toward ‘maximum pressure’ that could destabilise global markets if a strike occurs.”
Could destabilise global markets
Riz Malik, Director at Southend-on-Sea-based R3 Wealth, said gold prices could go up again if Trump strikes Iran.
He continued: “Global instability often prompts a flight to safe assets, leading to a short-term sell-off of equities and a move into precious metals like gold, which often see increased demand.
“A conflict during Ramadan will amplify the political tensions with neighbouring countries.”
Rohit Parmar-Mistry, Founder at Burton-on-Trent-based Pattrn Data, said the consequences could be disastrous for the world.
He added: “A strike on Iran isn’t just a geopolitical disaster; it’s an economic wrecking ball. The immediate casualty? The desperately-needed downtick in UK petrol prices. Any prolonged campaign in the Gulf will send crude soaring, and that pain hits the pumps instantly.
“But it doesn’t stop at petrol. Spiking energy costs will ripple through the supply chain, reigniting the inflation that ordinary people are already struggling to survive. In our audits we constantly see how vulnerable forecasting is to these exact shocks. Corporate systems are trained to assume stable markets, but they break completely when a superpower decides to play war games for profit.”
An economic wrecking ball
David Belle, Founder and Trader at Fink Money, believes, politically, that the US would wait until after the Winter Olympics closing ceremony on Sunday before attacking.
He said: “There is an interesting correlation with the Winter Olympics and conflict. Russia has traditionally conducted invasions during or just after the Olympics or Winter Olympics. Why? It provides a bit of a media shield, but also with the Winter Olympics, it has been the best time for a ground invasion before the ice melts and the ground turns mucky.
“In the US’s case with Iran, it’s likely they don’t want to strike while US athletes are in Milan, nor do they want to take away from the Italian spectacle. This would be a snub to Meloni’s government. I think we will see a strike just after the closing ceremony or in the days following it.”
Photo by Vanessa Schmid on Unsplash.
