THE war in Ukraine will cost British households £1,259 each this year, experts claim.
It will send prices for goods such as wheat and vegetable oils soaring, helping to push inflation to 8.7 per cent.
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Oil and gas charges, rocketing because of the conflict, will also drive prices up as food transport and production costs escalate.
The Centre for Economics and Business Research reckons the combined effects will slice £2,553 off household budgets in 2022.
About half the figure — £1,259 — can be directly attributed to the war in Ukraine, the CEBR says.
It urged Chancellor Rishi Sunak to take steps as the UK faces its worst fall in living standards since records began in 1995.
CEBR deputy chairman Doug McWilliams said Mr Sunak could cut fuel duty or temporarily reduce VAT. He said help was essential because growth this year stands to fall from a previously forecast 4.2 per cent to 1.9 per cent.
The consultancy expects no growth at all next year. He said: “There has never been anything like it. It’s a semi-wartime effect. I don’t think the Chancellor can get away with doing nothing.”
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James Smith, an economist with ING bank, said: “The war in Ukraine and the associated spike in energy costs means a growing risk that the UK will enter a consumer spending downturn.”
Minister Michael Gove warned the UK faced an energy shock similar to the 1970s when inflation hit 23 per cent and interest rates stood at 17 per cent.
BAKERY chain Greggs, which put up prices in January, said another increase was likely if ingredient costs continue to soar.
