EY warns Strait of Hormuz closure could shrink UK economy
EY's latest report warns that if the Strait of Hormuz, a crucial route for oil and gas, remains shut into mid-2027, the UK economy could actually shrink by 0.2% next year.
Growth would slow in 2026 too, dropping to just 0.5%.
It's all tied to how much energy gets through, so this closure could really impact everyday life.
Energy disruption risks UK inflation 6.4%
If energy supplies stay disrupted, inflation might soar to 6.4% by the end of 2026, way higher than the 3.5% peak expected if things get back to normal soon.
Rising prices mean people may spend less and businesses might hold back on investing, making it even harder for the UK economy to bounce back.
Strait of Hormuz reopening boosts growth
On a brighter note, EY says that if the strait reopens by September 2026, growth could pick up again (0.8% in 2026 and even 1.2% in 2027), giving the UK some much-needed momentum for recovery.