Middle East conflict drives up energy prices, putting pressure on the incomes of ordinary UK households

The report points out that against the backdrop of rising energy prices pushing up inflation, the incomes of average households in the UK are expected to shift from previously anticipated growth of 0.9% to a decline of 0.6% this year. The income growth rate for the lowest fifth of income earners is projected to fall from 2.8% before the conflict to 1.2%. The report believes that the rise in energy expenditure is significantly eroding the consumption capacity of UK residents. If energy prices do not fall back quickly and substantially, rising electricity and fuel costs will further increase the burden on UK households.