How will Russia’s war impact the cost of living crisis in the UK? | Personal Finance | Finance

The cost of living crisis already gripping Britain is expected to worsen as the war in Ukraine continues. Soaring energy bills, increased food costs and inflation have all caused Britons to tighten their belts, and the worst is yet to come due to worldwide sanctions on Russia.

Governments around the world have placed sanctions on Russia – and unfortunately, it won’t only be Russians feeling the pinch.

Russia is a mass exporter, with its main trades being gas and oil – but other commodities will likely be affected by UK and EU punishments on Russian banks and trade.

Nicholas Christofi, managing director of Sirius Property Finance, told Express.co.uk the “worst may be yet to come”.

He said: “A throttling of commodities from Russia and sanctions on Russian money will increase consumer prices, energy costs and interest rates still further.”

READ MORE: UK imports from Russia: Top 10 imports Britons benefit from

Petrol

Petrol has already peaked at over 150p per litre – an all-time high in the UK.

This is up by 26p on March 2021 figures.

Oil prices have risen as buyers shun Russian crude, with Brent crude passing $113 (approximately £84) a barrel this week.

The RAC said if the higher oil price is sustained, the cost of filling up a car in the UK will increase with it.

RAC fuel spokesperson Simon Williams said: “The sudden $10 (approximately £7.50) jump in the oil price is likely to take the average price of petrol towards 155p a litre and diesel to 160p, particularly as it’s looking like this price isn’t just a market blip caused by the US and allies deciding to dip into the strategic oil reserve.

“If oil does stay at this level, the journey to an average unleaded price of 155p may be far too quick.”

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Gems and expensive stones

Perhaps one for those of us with a little more disposable income, these are likely to become significantly dearer.

The UK imports 21 percent of all of its pearls, precious stones and metals from Russia.

Mr Cristofi told Express.co.uk: “As interest rates escalate to curb inflation, the cost of owning a home is also likely to increase as servicing a loan or mortgage becomes more expensive.

“As will a number of staples that we perhaps take for granted including bread, electrical goods and gemstones which are not exempt either.

“As an importer, the UK is set to be one of the worst affected as we consume around 6 percent of Russian exports, third in the ranking of worldwide consumption.

“Only China (16.3 percent) and the Netherlands (10.4 percent) import more as a percentage of total Russian exports.”