Oil and gas prices around the world have already started rising following the invasion, which has pushed UK petrol prices to a record high. Russia is also a big importer of fertilisers and wheat to Europe, so there are concerns that food production costs could also rise, having a knock on effect on supermarket prices.

We may even see inflation reach as high as 8% which is the highest it will have been in the last 30 years. Russia and Ukraine have been dubbed the "breadbasket of Europe''. This is because between them they export half of the world's sunflower products and a quarter of the world's wheat. This could cause food production to be affected and wheat prices to rise. In the UK we produce around 90% of our own wheat, however the cost of fertiliser is likely to rise for farmers. These higher costs will then eventually be passed to the consumer in higher food prices.

Oil prices have already dramatically increased, with barrels at their highest price for seven years. This adds costs to businesses that use transport and delivery. The RAC and AA motoring groups are reporting that average petrol prices hit nearly 149.5p on Wednesday and Diesel prices were 152.83p.

We are also likely to see further increase in the energy price cap by about 30% in October, rather than the previously predicted 20%, and this is on top of the 54% rise in April. The UK doesn't get its gas from Russia directly, but due to Western sanctions pushing President Vladimir Putin to slow supplies to Europe, wholesale prices could rise around the world which would directly affect the UK. Individual household energy bills could rise over £3000 a year in the UK from October 2022.

Businesses are now facing higher bills. Those that use transport as part of their business or that rely on regular deliveries will suffer from higher transport costs. Those that produce food and rely on ingredients will suffer from higher food costs. There are also fears of higher wholesale prices as a knock on effect on these price rises, as well as higher production costs. This may well make it harder for some businesses to meet profit margins with many facing difficult decisions over how much prices can be raised and if business is still viable. We could see both an increase in prices and an increase in business insolvency.

If you feel your business may be affected by these issues and would like to talk to someone for free advice about company insolvency then you can contact us by filling in this form. One of our specialist advisers will give you a call back as soon as they are free to discuss your circumstances and offer you advice about your next steps. You are also welcome to call or whatsapp us.