British citizens are preparing for an increase in fuel prices following a surge in oil prices triggered by the recent conflict between Israel and Iran.

Oil prices rose on Monday as concerns grew about a broader regional military conflict that could disrupt supplies. Iran, a major oil producer, accounts for approximately 3% of global supplies.

As the conflict entered its fourth day, Brent crude increased by 0.5% to $74.60 (£54.91) a barrel on Monday morning, while US crude rose by 0.7% to $73.42.

On Friday, crude prices surged by more than 13% to their highest levels since January, closing 7% higher for both benchmarks after Israel targeted over 100 sites in Iran, including nuclear facilities and missile sites, with Iran responding with its own missile strikes on Israel.

Thomas Pugh, an economist at RSM UK, stated that the rise in oil prices, around $10 per barrel in the past week, is expected to lead to a 5p increase in petrol and diesel prices over the next couple of months.

Currently, petrol prices range between 128.9p and 131.9p per litre in London, with diesel priced at about 134.9p per litre, according to Petrolprices.com.

There has not been a complete sell-off in oil markets, as indicated by the FTSE 100 share opening up 0.2% in London, with oil companies BP and Shell's stocks rising just over 1%. Stock markets in Germany and France also saw marginal increases upon opening.

Jochen Stanzl, the chief market analyst at CMC Markets, mentioned that the market anticipates a limited conflict, with expectations that hostilities will continue this week on a limited scale.

James Hosie, an analyst at Shore Capital, noted that the spike in Brent crude to $75 a barrel could be temporary if the direct impact on Iran's oil facilities remains limited.

Over the weekend, Israeli airstrikes targeted energy assets, including oil depots and refineries near Tehran and the South Pars gas field, raising concerns about a direct impact on Iran's oil exports.

There are fears that Iran's next response could disrupt tanker movements in the strait of Hormuz, affecting global oil and LNG supplies.

Despite the potential escalation of the conflict, OPEC members like Saudi Arabia could increase oil production to offset any disruption to Iranian exports, and US shale producers might also step in.

Following Russia's invasion of Ukraine in 2022, oil prices surged to nearly $130 a barrel, impacting prices across various sectors.

Rachel Reeves stated that the UK government would take all necessary measures to protect the economy from rising energy costs, emphasizing that they are not considering intervention similar to that in 2022 at this time.