𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

The Prime Minister has been told by a top adviser that he may have to hammer energy firms to tackle ‘profiteering’ as energy prices rise due to the Iran war. The comments come as a government minister told drivers today on UK TV not to panic buy and to keep buying petrol in the usual way.

As Donald Trump’s US administration calculates its next move in the growing crisis in Iran, Sir Keir Starmer’s cost of living tsar has proposed that the British government should enforce a temporary profit cap on energy companies and petrol retailers to curb “profiteering” amidst the current surge in energy prices sparked by the Iran conflict.

Lord Richard Walker – the executive chair of Iceland supermarkets, who was appointed to the government role last month – suggested to the Prime Minister that a profit cap which would restrict the earnings those companies could generate during extraordinary market conditions, according to the FT.

Walker stated he was not in favour of the Green Party’s proposal of a comprehensive, open-ended energy price cap, warning that it could result in “disastrous consequences such as rationing”.

However, he penned in the Sunday Times newspaper: “I have asked the government to consider a temporary profit cap, if necessary, to prevent producers and retailers exploiting the crisis to make windfall profits at the expense of consumers.”

He added: “As executive chairman of a retailer, I have no issue with profit. It’s what enables businesses to invest, employ people and pay tax. But I do have a significant problem with profiteering, particularly when families are under real pressure.

“There is already a windfall tax on North Sea oil and gas producers that was introduced in 2022. But Walker suggested that the cap could apply much more broadly to both “producers and retailers” who might be making windfall profits at the detriment of consumers. Officials stated there were no current plans to introduce a temporary cap.

They did not dismiss the idea of a profit cap, but they did not exclude the possibility of one being implemented in the future, the FT says.

One government figure commended Walker for “thinking big thoughts”, whilst another individual close to the situation mentioned there was an “active discussion” happening in Whitehall about how the measure could function.

It comes as an energy boss has suggested price increases may be “inescapable” if the conflict in the Middle East continues, even as the Government maintained there is no need to ration fuel.

Housing Minister Steve Reed stated there is a contingency plan in place, but encouraged people to “buy their fuel just like they always would”.

There are growing worries about how the Iran conflict could impact the cost of living, with the Prime Minister set to hold a Cobra meeting next week to discuss strategies to assist households. Iran has maintained its grip on shipping in the Strait of Hormuz, leading to a surge in oil prices.

On Sunday, the chief executive of Centrica, which owns British Gas, said global oil supplies are down 20% because of the conflict.

Chris O’Shea told BBC’s Sunday With Laura Kuenssberg programme: “Cornwall Insight, I think, have predicted that there’s going to be an increase in prices.

“If it stays as it is then I think that’s inescapable. The world uses about 100 million barrels of oil a day. We’ve lost about 20% of that through the Strait of Hormuz.”

Mr Reed urged people not to start panic-buying fuel, the Press Association reports. He told Sky News’ Sunday Morning with Trevor Phillips: “There’s no need to ration fuel. People should go around and buy their fuel just like they always would.

“If the situation were to change, then the Government would look at what was required in that circumstance.

“We did intervene when it came to heating oil, because we saw the prices escalating and people were seeing their bills doubling and tripling overnight. We can’t have that, so we stepped in to support people.”