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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
Forwarder, a Russian-flagged ship which left port in Primorsk last week, entered the Channel on Wednesday evening.
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Key events
Greg Wood
Gosden and O’Brien rivalry crackles in Gold Cup
The rivalry between top trainers John Gosden and Aidan O’Brien is a long way short of a feud – “Aidan and I are big rivals”, Gosden said on Wednesday, “but we get on and we tease each other a lot. There’s no harm in that and it’s a little bit of banter.”
But it still makes for an interesting undercurrent as Gosden’s Trawlerman, bidding to become only the second eight-year-old winner since 1900, takes on the up-and-coming Scandinavia, last year’s St Leger winner, in the feature event of the week.
Gosden’s “teasing” has included frequent references to the big teams of runners that Ballydoyle sends to many Group Ones, and when O’Brien suggested last autumn that he would love to see Ombudsman, the winner of Wednesday’s Prince of Wales’s Stakes, line up for the Irish Champion Stakes, Gosden responded that his stable star would not “appreciate running against multiple entries from one stable on a track with a short straight.”
The possibility that Ballydoyle was employing “team tactics” with its runners was also highlighted after Tuesday’s St James’s Palace Stakes, when Christophe Soumillon, on the O’Brien second-string, Puerto Rico, picked up an eight-day ban for riding “in a manner to benefit” his stable companion and second-favourite, Gstaad.
There is little chance of a dust-up over tactics in the Gold Cup, however, as Scandinavia is O’Brien’s only runner in the race and Trawlerman is likely to make his own running. The regular to-and-fro between the two trainers, though, will add extra spice to the closing stages if Trawlerman and Scandinavia are duking it out in the final furlong.
Greg Wood
6.10 BUCKINGHAM PALACE STAKES HANDICAP preview
The money is all for runners in high-numbered stalls in the finale, and that’s hardly surprising given the way that races on the straight course have been unfolding this week. Jack Channon’s Mezcala, in stall 30, is currently a narrow favourite and remains feasibly handicapped dropping back to seven furlongs from a mile, while Cosi Bello (26) was a bit better than his narrow winning margin might imply at Haydock last time and also has form in a big field on this course. Elerak, highest of all in 31, is also attracting support to give Billy Loughnane another winner at the meeting, while Blue Brother, unraced since suffering all manner of bad luck when fancied for the Hunt Cup here last summer, is another fascinating contender from stall 28.
Timeform top-rated: Dance In The Storm
SELECTION: BLUE BROTHER
Greg Wood
5.35 HAMPTON COURT STAKES preview
Not the loftiest event on the Royal Ascot schedule by any means, but still an interesting contest for three-year-olds that are just below the top rung, for the moment at least, and it occasionally highlights a colt on the way to better things. Endorsement, the Aidan O’Brien-trained favourite, was still engaged in the Derby until quite late in the day, and drops back to 10 furlongs having skated up in a Listed race over a mile-and-a-half just a fortnight ago. Maho Bay too was seen as a possible for a run in the Derby until blotting his copy book by finishing fourth behind Maltese Cross in the Lingfield Derby Trial, but the winner there went on to finish second at Epsom and so the form may well be better than it seems. The list of Derby trial disappointments also includes Morshdi, fifth in the Dante, while Oxagon, the Craven Stakes winner in April, has failed to build on that in two runs since, though the latest was admittedly a Classic as he finished 12th of 16 in the French Derby at Chantilly. Generic, meanwhile, was seven lengths behind Constitution River – surely the best three-year-old colt seen out this year – in the Dee Stakes at Chester, having only started his racing career in March, and will also be bang there on that form with only marginal improvement.
Timeform top-rated: Endorsement.
SELECTION: GENERIC
Greg Wood
4.50 BRITANNIA STAKES preview
This straight-mile handicap for three-year-olds is, for me at least, the toughest Royal Ascot test of them all from a betting point of view – looking down the list of previous winners, I’m fairly sure that Perotto, in 2021, is the only winner I’ve had this century – and this year’s renewal looks as competitive as always. It looks as though I’ve managed to find the favourite, though, as David Marnane’s Jamestown has attracted plenty of support this morning, and has both the high draw and the run style that you need to be looking for on the straight course this week. A list of dangerous opponents is effectively everything else – even the 80-1 shot Winding Stream is within 7lb of the top-rated horse on Timeform’s numbers and was racing in Group company last time – but We’re Goosers is sure to be popular as a result of his nine-and-a-half length win last time, and so too Organise, from the John & Thady Gosden yard, who was touched off in a well-run race last time and sports first-time cheekpieces today. Moonfall, an eye-catcher at Chester in May, and Exclusive Code, the winner of a big-field maiden at Newbury, are also on the short-list, but frankly, your guess is as good as mine.
Timeform top-rated: We’re Goosers.
SELECTION: JAMESTOWN
An inaugural “Royal Ascot colour of the year” has been introduced this year, and on Gold Cup day guests were encouraged to wear their best “bright tomato” shade as part of the dress code. This chap got the memo.
Oddschecker market movers
Greg Wood
4.15 GOLD CUP preview
The staying division is currently missing a truly “public” horse like the three-time winner, Stradivarius, but Trawlerman, last year’s winner, will be a stern test for the posse of four-year-olds in this year’s Gold Cup field that could conceivably run up a sequence over the next few years if all goes well. The list is headed by Aidan O’Brien’s Scandinavia, last year’s St Leger winner, who arrives in Berkshire looking for a sixth straight success, while Rahiebb and Carmers, second and fifth at Doncaster, are also looking to establish themselves as Cup horses with a win in the most prestigious staying event of them all. Other live runners include Al Riffa, last season’s Irish St Leger winner, for the Joseph O’Brien stable, and George Scott’s Caballo De Mar, a Group One winner over two miles in France last time out. My idea of the best bet in the race, though, is Carmers, on the basis that Trawlerman missed his intended prep race in May and may be slightly short of his best, while Paddy Twomey’s runner – who beat both Scandinavia and Rahiebb in the Queen’s Vase here last summer – has as much chance as either of his fellow four-year-olds of finding the necessary improvement stepping up to two-and-a-half miles.
Timeform top-rated: Trawlerman
SELECTION: CARMERS
Royal Ascot Procession List
1st Carriage
The King
The Queen
The Earl of Snowdon
Ms Isabelle de la Bruyère
2nd Carriage
The Princess Royal
Vice Admiral Sir Tim Laurence
The Duke of Edinburgh
The Duchess of Edinburgh
3rd Carriage
Princess Zahra Aga Khan
HH Sheikh Hamad bin Abdullah al-Thani
Mrs Zara Tindall
Mr Willie Mullins
4th Carriage
Lord Cavendish
Lady Cavendish
Mr Stanley Tucci
Ms Felicity Blunt
Stanley Tucci is in the carriages today. An acclaimed actor, of course, he’s also well known for his cooking so perhaps he helped with luncheon at Windsor Castle to which the carriage guests are invited before their trip down the track. Now you know why the racing doesn’t start till 2.30pm!
Andrew is innocent!
I know you would miss the regular royal spot ahead of the Royal Procession list announcement at noon if we didn’t share some and today’s concerns Lady Victoria Hervey who has arrived at the races today. For those unawarer she’s a British socialite and former model who dated Prince Andrew (now Andrew Mountbatten-Windsor) briefly in 1999. Throughout the fallout from his associations with Jeffrey Epstein, she has remained one of the prince’s most vocal defenders. In an interview with LBC in February, not only did she admit to being named in the Epstein files herself, but branded anyone who wasn’t as a “loser”. With friends like this …
Greg Wood
3.40 RIBBLESDALE STAKES preview
Sound the stat klaxon, it’s time for the one about Oaks runners in the Ribblesdale as Legacy Link attempts to win Ascot’s Group Two for three-year-old fillies having run in the Epsom Classic last time out. A total of 33 fillies have lined up for this race after running in the Oaks since 2010 and just two have won, with the list of beaten runners including three favourites and seven more that set off at 5-1 or shorter. It is a big ask, in other words, and Legacy Link, the Epsom runner-up behind impressive winner Thundering On, will deserve huge credit if she can pull it off on what will be her third start in just over a month. Earth Shot and French challenger Gilded Prize are the likeliest opponents to give her something to think about, and while neither managed to win last time out, both look sure to blossom over this trip. And there is a royal runner to look out for too, although Golden Orbit, a home-bred daughter of Sea The Stars who was a beaten favourite last time, is friendless in the market at 33-1 and the first-time blinkers will need to spark serious improvement.
Timeform top-rated: Legacy Link
SELECTION: EARTH SHOT
Greg Wood
3.05 KING GEORGE V STAKES HANDICAP preview
Plenty of future Group-race winners have won this handicap for three-year-olds in the past, and plenty have been beaten in it too, as it is a race that generally throws up a hard luck story or three. All but a handful of the 19 runners have shown enough promise already to be credible winners if they continue to progress, with Charlie Appleby’s Into the Light,Heyzoom (Owen Burrows) and Tierra Del Toro (Ralph Beckett) probably the most obvious names to note, alongside Joseph O’Brien’s Enceladus, with Ryan Moore booked to ride in the absence of a runner from the trainer’s dad’s stable. O’Brien jnr is having a stormer of a meeting so far, and was tied with O’Brien snr on three winners at the top of the trainers’ table after day two, and Enceladus is one of four from the stable in this race, including Cannes, the favourite, who got off the mark at the third attempt at Leopardstown in May. Heyzoom posted an excellent winning time when successful over 10 furlongs at Newbury last time, while Into The Light has been narrowly beaten on his last two starts but was given a lot to do by William Buick over a two-furlong shorter trip last time.
Timeform top-rated: Heyzoom.
SELECTION: HEYZOOM
2.30 CHESHAM STAKES preview
Aidan O’Brien’s first chance of the afternoon to get the one winner he needs to be the first trainer to a century at Royal Ascot comes via his colts Aix La Chapelle and second-string South Dakota, in a race that he has won five times in the last decade. Aix La Chapelle looked very rough around the edges on his debut at the Curragh just a fortnight ago but still ran out an easy winner and should find plenty for the experience. He is drawn in stall five, though, which is less than ideal on the evidence from the straight course over the first two days. Another leading Irish-trained runner, Fozzy Stack’s Nola Soul, also overcame greenness to win on debut and could give the favourite plenty to think about, while George Scott’s Sea Venture found all the trouble going on her first start over six furlongs before showing a smart turn of foot to win with plenty to spare. As a daughter of the Derby winner, Sea The Stars, she looks certain to improve for the extra furlong today.
Timeform top-rated: Aix La Chapelle
SELECTION: SEA VENTURE
Going to start putting up some previews of the day’s action from our racing correspondent and tipster Greg Wood, who is currently leading the national press challenge in the Racing Post.
Good morning. It was overcast this morning but no precipitation so the going for day three of Royal Ascot is: Good to Firm and there’s very little between the different sides of the track.
GoingStick readings at 8.30am:
Stands’ side: 8.8
Centre: 8.7
Far side: 8.7
Round course: 7.5
We have one non-runners so far so cross this off your list of possible wagers …
4.50pm Britannia Stakes: 16 Bobby McGee (vet’s certificate – temperature)
Preamble
Good morning from Ascot on the third morning of the Royal meeting 2026 – Gold Cup day – where Aidan O’Brien is poised to become the first trainer to saddle a century of winners at Flat racing’s showpiece event, having moved to 99 with a winner in the first race on Wednesday.
There are more races to aim at these days than there were in the era when the late Sir Henry Cecil racked up what was, at the time, a record 75 winners, and while the Sir Michael Stoute was active well into the five-day Ascot era and had saddled 82 by the time of his recent retirement, O’Brien’s record is still an astonishing achievement, even by the standards of the pre-eminent trainer of the last 25 years.
He has a total of seven runners on today’s card as he looks to reach three figures, including Scandinavia, the somewhat uneasy favourite, in the Gold Cup at 4.15 and opening up with Aix La Chapelle in the Chesham Stakes at 2.30.
Scandinavia’s main Gold Cup rival, according to the betting at least, is last year’s winner, Trawlerman, and there is now less than a point between them in the betting. Elsewhere on the day three card, the Oaks form gets an early test as Legacy Link, the Epsom runner-up, lines up for the Ribblesdale Stakes (3.40) just two weeks on from her big run in the Classic, while the Britannia Handicap at 4.50 could well turn out to be the most competitive event of the entire meeting – just two of the 30 runners are currently on offer at single-figure odds.
Another 5mm of water was applied overnight to maintain the going at good-to-firm, thoughts on possible winners are here, and the action is underway at 2.30 on what could be a historic day at Royal Ascot. One hundred is only a number, but it’s an impressive number all the same.
The Bank last cut interest rates in December but upheaval in the Middle East has stalled any further reductions.
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