War in the Middle East has caused a record-breaking spike in the price of oil, as the cost of a barrel rocketed to above $100 for the first time in years.
An emergency meeting of the G7 has been called, where firefighting options including the release of its oil reserves will be discussed.
The Straight of Hormuz, through which around a fifth of the world’s oil travels, is at a standstill, meaning major uncertainty hangs over short-term supply.
Iran‘s Revolutionary Guard has threatened to ‘set ablaze’ any Western tanker that attempts to navigate the strait, and hundreds of ships laden with oil have amassed outside it.
For the first time since war broke out, the effect of this disruption was felt acutely this morning, when the price of a barrel of Brent crude shot up almost 24 percent.
Petrol prices at the pump are likely to surge as the higher cost filters through to consumers.
UK Chancellor Rachel Reeves will attend an emergency meeting of G7 finance ministers at 1:30pm GMT, chaired by France, to address the economic fallout of the war.
Oil reserves are co-ordinated by the International Energy Agency (IEA), with 32 members of the group holding stocks as part of a collective emergency system designed to mitigate oil price crises.
Three G7 countries, including the US, have so far indicated their support for a possible joint release, according people familiar with the talks, the FT reports.
US President Donald Trump acknowledged the economic shockwaves that the conflict is having, but insisted temporary price rises are a small price to pay for eliminating Iran’s nuclear threat.
Explosions erupt following strikes in Tehran over the weekend
Oil tankers anchored outside the Strait of Hormuz
