Consumer Confidence Plummets as Iran War Sends Oil Prices Soaring — What It Means for Your Wallet

A wave of economic anxiety is sweeping across global markets as the US-Israel war with Iran drives oil prices up by 50% and consumer confidence to its lowest levels in months. Here is what you need to know and how it affects your personal finances.

Key Facts

• Brent crude oil surged 50% to $110 per barrel since the outbreak of the US-Israeli war with Iran on February 28, 2026
• Petrol prices up 13% on average, while diesel has climbed 25% according to RAC data
• UK consumer confidence index fell 2 points to minus 21 in March, with economic expectations dropping 6 points to minus 37 (GfK Consumer Confidence Barometer)
• Retail sales fell 0.4% in February according to ONS figures, with supermarket and household goods sales declining
• Household energy bills could rise by approximately £300 per year from July according to Cornwall Insight forecasts
• Consumers are shifting toward more saving and less big-ticket spending amid economic uncertainty

What This Means for You

Fuel costs are going up — plan ahead. If you drive regularly, expect to pay noticeably more at the pump. Consider consolidating trips, carpooling, or using public transport where possible. The trend is likely to continue as long as the Middle East conflict persists.

Energy bills may spike after summer. While the energy price cap falls in April, forecasts suggest a significant increase from July. Now is the time to lock in fixed-rate energy deals if available, and to invest in energy efficiency improvements for your home.

Big purchases can wait. With consumer confidence dropping and retailers facing pressure, there may be better deals ahead. Avoid impulse spending on furniture, electronics, and other large items unless necessary.

Build your emergency fund. The “ripple of fear” described by analysts signals a period of economic uncertainty. Having 3-6 months of expenses saved up is more important than ever.

Review your budget. Rising costs across fuel, energy, and potentially food and goods due to higher shipping costs mean your monthly expenses may increase. Adjust your budget now rather than being caught off guard.

Note: While this article references UK data, the underlying drivers — oil price spikes and geopolitical uncertainty — affect consumers globally.

Sources: BBC News | BBC – Asda Petrol Prices | BBC – Trump and Oil Markets