Retailers are urging the UK government to help reduce their energy costs to avoid passing rising prices on to shoppers, as a new poll reveals that four in five Britons are worried the conflict with Iran will make food more expensive.
Growing Concerns Over Grocery Prices
Research by Opinium found that 80% of people are concerned about rising grocery prices, which could result from retailers passing on increased costs. Additionally, 73% expect the Middle East conflict to push up prices of other products. The blockade of the Strait of Hormuz has already driven oil and gas prices higher, caused a crisis in the global fertiliser industry, and increased shipping and distribution expenses.
Impact on Businesses and Government Action
The effects have been most acute in energy-intensive sectors like manufacturing and chemicals. Chancellor Rachel Reeves announced additional support for bills for the most energy-intensive businesses in April, but faces new calls to cut costs for the food sector. Helen Dickinson, chief executive of the British Retail Consortium (BRC), stated that the war is "driving up costs across the supply chain and families are right to be concerned."
She urged ministers to remove non-commodity energy costs for retailers, which are charges and fees that constitute a large portion of electricity bills. "Other governments are already acting," she added. "Germany has reduced electricity costs for businesses by moving levies off bills, and EU leaders are actively discussing similar responses. The UK should be moving in the same direction."
Cost of Living Crisis Remains Key Issue
The Opinium survey of 2,000 people indicates the cost of living crisis will remain a crucial political issue beyond the local elections. It found 81% worried about rising energy bills, 76% about petrol and diesel prices, and 68% about tax increases. These factors could contribute to rising grocery prices, with the Bank of England forecasting food inflation to reach 7% by year-end due to higher fertiliser, energy, and transport costs.
Official data shows food and non-alcoholic beverage prices rose 3.7% in the year to March 2026, up from 3.3% the previous month. Supermarket bosses met Reeves in early April to assess the conflict's impact on living costs. Simon Roberts, CEO of Sainsbury's, said limiting energy prices for retailers is "the single biggest thing the government should do to keep prices down."
Uncertainty in the Middle East
Uncertainty persists in the Middle East, with Donald Trump's promise to use warships to open a route through the Strait of Hormuz for trapped ships bringing the region back to the brink of full-scale war as Iran seeks to reassert its blockade. Research earlier this week found food prices are on track to be 50% higher in November than at the start of the cost of living crisis in 2021. Climate and energy shocks have nearly quadrupled the pace of food price growth, according to the Energy and Climate Intelligence Unit.
Dickinson added: "Retailers are working hard to hold prices down, but they cannot do it alone. Every cost government chooses not to address is a cost that will find its way into someone’s shopping basket. That is a political choice, and it is one ministers still have time to change – but the window to act is closing."
A government spokesperson said: "We are acting to protect people from any potential increases in food prices. We have already suspended select food tariffs and continue to work closely with the sector to keep household bills down."
