UK News
UK exports to Middle East tumble as Iran war hits economy – business live | Business
Introduction: UK exports to Middle East drop 20 % since war began
Good morning, and welcome to our rolling coverage of business, the financial markets, and the world econony.
UK trade to the Middle East has shrunk since the Iran war began eight weeks ago, new data shows.
The British Chambers of Commerce has reported that the number of certificates of origin issued by Chambers of Commerce for exports to the region fell by 20% year-on-year in March, down from 15,437 in March 2025 to 12,360 in March 2026
This decline indicates goods are either being delayed, rerouted or not shipped at all.
Companies classified as Arab League countries for certificates of origin include Algeria, Bahrain, Comoros, Djibouti, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman, Qatar, Saudi Arabia, Somalia, Sudan, Syrian Arab Republic, Tunisia, United Arab Emirates and Yemen.
Steven Lynch, director of international trade at the British Chambers of Commerce, says UK firms are dealing with less reliable trade routes, rising costs and geopolitical risks, adding:
“Our documentation data shows a clear and immediate shock to UK trade flows linked directly to disruption across the Middle East. The fact that exports tied to Arab markets are falling far faster than elsewhere tells us this is a targeted, region‑specific impact, not a broad‑based downturn.
“Firms are reporting increased delays, rerouting via longer and more expensive pathways, enduring rising insurance premiums and facing stretched lead times. For SMEs in particular, this squeezes cashflow and confidence at a time when exporting is already challenging.
There’s no let-up in that challenge today, with the strait of Hormuz still badly disrupted and reports that the US is planning for a lengthy blockade of Iranian ports.
According to the Wall Street Journal, US President Donald Trump has instructed aides to prepare for an extended blockade of Iran.
UK companies are already pessimistic about the economic outlook, and expect activity to fall in the next three months according to the CBI’s latest Growth Indicator.
It has found that business volumes in the services and manufacturing sector are anticipated to fall over the quarter,
Alpesh Paleja, CBI deputy chief economist, explains::
“Business’ expectations for activity have weakened further, as companies continue to grapple with uneven trading conditions, strong cost pressures and renewed uncertainty.
“These challenges have been exacerbated by the conflict in the Middle East, which is increasingly hitting a broad swathe of UK businesses. Our surveys suggest that the additional pressure on costs and supply chains is feeding through to pricing intentions – but not nearly enough to offset the burden facing firms.
The agenda
-
10am BST: Eurozone economic sentiment data
-
2.45pm BST: Bank of Canada interest rate decision
-
7pm BST: US Federal Reserve intereat rate decisoin
-
7.30pm BST: Federal Reserve press conference
Key events
Lloyds profits jump despite £151m impairment charge from Middle East conflict
Lloyds Banking Group has shrugged off the economic uncertainty caused by the Iran war, by beating profit expectations for the first three months of the year.
Earnings at Lloyds jumped by a third in the first three months of 2026 to £2bn, up 33% compared with a year ago, and ahead of analyst forecasts of £1.8bn.
Lloyds chief executive Charlie Nunn said the banking group’s business model was “resilient in the context of the current economic uncertainties”, adding:
“We remain focused on supporting UK households and businesses as they look to strengthen their financial positions and achieve their goals.”
Lloyd also took a £151m impairment charge to reflect “the deterioration in economic outlook as a result of the Middle East conflict”. However, that was partly countered by a £50m improvement in “global tariff and political disruption risks”.
The uncertainty over the Middle East conflict means many holidaymakers are delaying their bookings until closer to departure time.
Jet2, the flights and package holiday firm, has reported this morning that since the conflict began, its customers’ “booking profile has become increasingly close to departure”, adding:
At present, Q1 (April, May, June) combined average load factor is in line with the prior year, with the current geopolitical uncertainty limiting visibility for the peak summer season and beyond.
As previously stated, we continue to invest in load factor and remain fully committed to pricing that is attractive and represents real value to our Customers.
Passenger bookings for summer 2026 are up 6.2% compared with the previous year, while Jet’s capacity is currently 7.7% higher than in summer 2025.
The company adds that it has ‘a high degree of cost certainty’ about its jet fuel costs, as it has hedged 87% of its summer requirements.
Heathrow has warned that it faces an ‘uncertain outlook’, after a positive start to the year.
London’s largest airport has reported a 3.7% rise in passengers in the first quarter of this year, up to 18.9m.
It says:
Following airspace closures in the Middle East, there was an increase in transfer passengers across Heathrow’s network. While Heathrow has temporarily absorbed demand from elsewhere, passenger numbers for the rest of the year are likely to be impacted whilst there is significant uncertainty in the Middle East.
Heathrow adds that it has “seen some impact from recent Middle East disruption”, but has not yet updated its outlook for 2026.
More UK firms fall into financial distress
The number of UK businesses in “critical financial distress” has jumped by more than a third amid fresh pressure linked to the conflict in the Middle East, according to new research.
Hotels and leisure firms are in particular distress after facing higher labour costs and taxes over the past year, latest research from Begbies Traynor Group (BTG) has shown.
BTG’s latest quarterly red flag report indicated that more firms edged closer to collapse in the first quarter of 2026 – the number of companies considered in “critical financial distress” rose by 36.9% to 62,193 for the quarter, compared with the same period a year earlier.
The number of businesses in “significant” financial distress meanwhile rose by 9.6% year on year to 634,867.
Ric Traynor, executive chairman of BTG, said:
“The shockwaves from a war in the Middle East will be felt across every corner of the global economy for some time to come.
After initial signs that the UK’s GDP was improving at the very start of the year, it now feels like after taking a step forward, the UK has taken a few steps backwards following one of the most severe energy shocks in living memory.”
Introduction: UK exports to Middle East drop 20 % since war began
Good morning, and welcome to our rolling coverage of business, the financial markets, and the world econony.
UK trade to the Middle East has shrunk since the Iran war began eight weeks ago, new data shows.
The British Chambers of Commerce has reported that the number of certificates of origin issued by Chambers of Commerce for exports to the region fell by 20% year-on-year in March, down from 15,437 in March 2025 to 12,360 in March 2026
This decline indicates goods are either being delayed, rerouted or not shipped at all.
Companies classified as Arab League countries for certificates of origin include Algeria, Bahrain, Comoros, Djibouti, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman, Qatar, Saudi Arabia, Somalia, Sudan, Syrian Arab Republic, Tunisia, United Arab Emirates and Yemen.
Steven Lynch, director of international trade at the British Chambers of Commerce, says UK firms are dealing with less reliable trade routes, rising costs and geopolitical risks, adding:
“Our documentation data shows a clear and immediate shock to UK trade flows linked directly to disruption across the Middle East. The fact that exports tied to Arab markets are falling far faster than elsewhere tells us this is a targeted, region‑specific impact, not a broad‑based downturn.
“Firms are reporting increased delays, rerouting via longer and more expensive pathways, enduring rising insurance premiums and facing stretched lead times. For SMEs in particular, this squeezes cashflow and confidence at a time when exporting is already challenging.
There’s no let-up in that challenge today, with the strait of Hormuz still badly disrupted and reports that the US is planning for a lengthy blockade of Iranian ports.
According to the Wall Street Journal, US President Donald Trump has instructed aides to prepare for an extended blockade of Iran.
UK companies are already pessimistic about the economic outlook, and expect activity to fall in the next three months according to the CBI’s latest Growth Indicator.
It has found that business volumes in the services and manufacturing sector are anticipated to fall over the quarter,
Alpesh Paleja, CBI deputy chief economist, explains::
“Business’ expectations for activity have weakened further, as companies continue to grapple with uneven trading conditions, strong cost pressures and renewed uncertainty.
“These challenges have been exacerbated by the conflict in the Middle East, which is increasingly hitting a broad swathe of UK businesses. Our surveys suggest that the additional pressure on costs and supply chains is feeding through to pricing intentions – but not nearly enough to offset the burden facing firms.
The agenda
-
10am BST: Eurozone economic sentiment data
-
2.45pm BST: Bank of Canada interest rate decision
-
7pm BST: US Federal Reserve intereat rate decisoin
-
7.30pm BST: Federal Reserve press conference
UK News
Consequences of Iran war ‘may echo for months or years to come,’ EU chief warns – Europe live | European Union
EU needs to reduce its overdependency on imported fossil fuels, and focus on clean energy supply, von der Leyen says
On the Middle East, von der Leyen says that the EU “want the ceasefires in Iran and Lebanon to hold,” with urgent need to “re-establish peace and stability through diplomatic means.”
But she warns that “the consequences of this conflict may echo for months or even years to come.”
“This is the second energy crisis within four years, and the lesson should be very clear. Our overdependency on imported fossil fuels makes us vulnerable. … We must reduce our overdependency on imported fossil fuels and boost our home-grown, affordable, clean energy supply. From renewables to nuclear, in full respect of technology neutrality.”
Key events
‘On my way to Brussels!,’ incoming Hungary’s PM Magyar says ahead of EU meetings
Hungary’s incoming prime minister Péter Magyar has just posted a social media update that he is on his way to Brussels for his talks with the European Commission president, Ursula von der Leyen, and the European Council president, António Costa.
“A huge mandate, a strong mandate, a great responsibility!
We know our task: we will bring home the EU funds that Hungarians are entitled to. More soon.”
Meta found in breach of EU law for failing to keep children off platforms
Jennifer Rankin
in Brussels
The tech company Meta has been found to be in breach of EU law for failing to prevent children under 13 from using its Facebook and Instagram platforms.
Issuing the preliminary findings of a nearly two-year investigation, the European Commission said on Wednesday that Meta did not have effective measures in place to stop under-13s accessing its services.
The US tech company was unable to meet its own terms and conditions that set 13 as the minimum age to access Facebook and Instagram safely, the commission said.
Following an initial assessment, Meta was found in breach of the EU’s Digital Services Act (DSA), which requires it to “diligently identify and mitigate the risks” of under-13s using its platforms.
The commission said its preliminary findings “do not prejudge the final outcome of the investigation”.
A Meta spokesperson said the company disagreed with the preliminary findings.
“We’re clear that Instagram and Facebook are intended for people aged 13 and older and we have measures in place to detect and remove accounts from anyone under that age. We continue to invest in technologies to find and remove underage users and will have more to share next week about additional measures rolling out soon.”
Timmy the whale en route to North Sea as rescue operation moves from Germany
In somewhat lighter news, we know that many of you have been following the saga of Timmy the whale and the audacious attempt to rescue him from Germany and send him back to the Atlantic Ocean. Our Kate Connolly reported on this in detail.
Timmy is now properly under way towards the Atlantic, travelling at steady 4.5kn (8.5 km/h). The plan is to take him around the northern end of Denmark and then release into the wild again – but it will take a few days to get there.
You can follow his journey aboard a custom-made whale barge – essentially a giant steel aquarium – pulled by Fortuna B ship here.
Russians ‘feel they live behind digital iron curtain,’ EU chief says
In von der Leyen’s speech earlier, there was one other notable passage.
When talking about Russia, she warned that as the Russian economy is increasingly struggling with the impact of sanctions, “the Kremlin responds in an unusual way by restricting the internet and free communication.”
“So much so that Russians feel that they live behind an iron curtain again; this time a digital iron curtain. But, hon members, if history has one lesson, it’s that all walls eventually fall.”
Germany arrests man suspected of espionage for Russia
A Kazakh man was arrested in Germany for alleged espionage for Russia, which allegedly included passing on details on Germany’s military infrastructure and its support for Ukraine to Moscow.
The Federal Prosecutor’s Office said the man, identified only as Sergei K, was particularly interested in the German arms and defence industry, including companies developing drones and robots, and offered hints as to “suitable targets for sabotage in Germany,” offering to recruit accomplices to help him carry them out.
He will appear in court later today.
EU needs to coordinate more on fuel reserves, focus on electrifying Europe, von der Leyen says
Von der Leyen says that “every member state has a different energy mix,” so no blanket EU solution would work.
But she calls for more coordination not just on common procurement, but also on fuel reserves, “especially jet fuel and diesel, where markets are tightening.”
She adds that the EU needs to “protect consumers and businesses,” but targeting “the most vulnerable households and industries only.”
Von der Leyen says that previously too much money was spent on “untargeted” interventions, and this needs to change.
She says the EU needs to “reduce energy demand by modernising systemic energy use,” with grid reforms,
“ Let us use this to make the switch to electricity – not just in transport, but also in industry and heating. This is not only a matter of affordability and competitiveness; this is also a matter of economic security. Thus, speaking of European independence, this is the moment to electrify Europe.”
EU needs to reduce its overdependency on imported fossil fuels, and focus on clean energy supply, von der Leyen says
On the Middle East, von der Leyen says that the EU “want the ceasefires in Iran and Lebanon to hold,” with urgent need to “re-establish peace and stability through diplomatic means.”
But she warns that “the consequences of this conflict may echo for months or even years to come.”
“This is the second energy crisis within four years, and the lesson should be very clear. Our overdependency on imported fossil fuels makes us vulnerable. … We must reduce our overdependency on imported fossil fuels and boost our home-grown, affordable, clean energy supply. From renewables to nuclear, in full respect of technology neutrality.”
‘We will continue our support to Ukraine,’ von der Leyen declares
Commission president von der Leyen is speaking now and begins with an update on the €90bn loan for Ukraine.
She says the EU always insisted it would deliver the loan “one way or the other,” and it’s now done as Hungary has dropped its veto.
The first tranche of €45bn will be paid out “this quarter,” she says.
“Our message is clear: we will continue our support to the brave Ukrainian people and their armed forces.”
She also repeats that “while Russia doubles down on its aggression, Europe doubles down on our support to Ukraine.”
Morning opening: Iran, Hungary and your holidays
Jakub Krupa
European Commission president Ursula von der Leyen is set to brief EU lawmakers on the bloc’s view of the Iran war and the likely impact on the European economies.
Her assessment will probably strike a tricky balance as she wants to reassure them that everything is in hand, while making it also clear that things may get tricky further down the line.
Only last week, the commission talked about a number of measures it had at its disposal to soften the blow, and sought to assure Europeans that their holidays are not (yet) at risk.
I will bring you all the key lines from her speech here.
Later today, von der Leyen will welcome Hungary’s incoming prime minister Péter Magyar as he continues his bid to get a political agreement with the EU on accelerated reforms in key areas in exchange for unfreezing billions of euros in EU funds.
Magyar, who will only formally take the job on 9 May, is a man in hurry as the future of some €10bn of EU funds need to be decided before August. It’s going to be a busy summer in Budapest. If you’re a Tisza MP, I wouldn’t book your holidays.
It’s Wednesday, 29 April 2026, it’s Jakub Krupa here, and this is Europe Live.
Good morning.
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