Newsflash: oil has now hit its highest level in almost four years, after Donald Trump signalled that he will maintain the US blockade on Iranian ports.

The Brent crude oil price hit $119.76 a barrel a few minutes ago, breaking above its previous high of $11.90 set in the early weeks of the Iran war.

A late update: Oil is now approaching its highest level since the Iran war began.

Brent crude has risen over $119 a barrel, up 7% today, after president Donald Trump told Axios he will not lift a naval blockade of Iran’s ports until he secures a deal with Tehran to address the country’s nuclear program.

This decision extends the ongoing standoff over the Strait of Hormuz that has caused a global energy crisis.

Trump said in a phone interview Wednesday, according to Axios:

“The blockade is somewhat more effective than the bombing. They are choking like a stuffed pig. And it is going to be worse for them. They can’t have a nuclear weapon,”

Time to wrap up…

Oil and gas prices have jumped, following reports that the US has discussed extending its blockade of Iranian ports for months.

The UK government has asked British refineries to maximise jet fuel supply, as part of its contingency planning to maintain supplies.

The Middle East conflict has knocked UK exports to the region down by a fifth.

Lloyds Bank has taken a £151m charge to cover the economic damage of the Iran war.

Britain’s biggest drugmaker AstraZeneca has said it will invest £300m in the UK in a surprise U-turn after pausing large-scale projects last year.

It said it would invest in two existing locations, unfreezing a paused £200m expansion in Cambridge and pouring £100m into its Macclesfield site.

Anyone hoping for the blockade to come to an end this week has been “deeply disappointed”, points out Kathleen Brooks, research director at XTB.

The latest news from the White House suggests that President Trump is looking at measures to maintain the blockade for an extended period if necessary. The President met with oil company executives, presumably to boost US refinery production, especially for diesel and jet fuel. Financial markets will now need to price in the prospect of a prolonged blockade. This is obviously impacting on the oil price, which is higher by nearly 10% in the past 5 sessions. It could also lead to higher futures prices, as the market adjusts to a long-term closure of the Strait.

We assume the President wants US oil companies to boost production, however, if US oil refineries focus on ramping up production of jet fuel and diesel, it could reduce output of other products, which may lead to broader inflationary pressures for the global economy. This is a new phase of the war in Iran, and we could now see oil prices go back to the March highs around $120 per barrel for Brent.

As always with President Trump, his rhetoric on Truth Social may not reflect reality. The President has also urged Iran to sign a deal to end the US blockade. The US is using the blockade to squeeze Iran, we will now find out how long they can hold out.

If this is a long-term blockade, we will find out whether financial markets are underpricing the risks of the war in the Middle East.

Back in the energy markets, oil and gas prices are pushing higher amid worries that the US blockage of Iran may drag on for months.

Brent crude is up 5% at almost $117 a barrel, close to the highest level set since the Iran war began ($119.50 a barrel).

The UK month-ahead gas price is up 5% at 113.86p a therm, while the benchmark Dutch front-month contract was up 5.35% at €45.93 per megawatt hour (MWh)

Energy prices rose following reports that U.S. President Donald Trump met with top officials from energy companies on Tuesday to talk about steps that could be taken to calm oil markets if it is necessary to continue the blockade of Iranian ports for months, a White House official said on Wednesday.

The talks centered on U.S. oil production, oil futures, shipping and natural gas, the official said (via Reuters).

Pascal Soriot, AstraZeneca’s chief executive, has thanked the UK government “for their effort to improve access for patients, including four new [drug] approvals since the beginning of the year, and we look forward to further enhancing the access and the reimbursement environment and build a strong life sciences sector”.

Newsflash: Pharmaceuticals group AstraZeneca is investing £300m in its UK operations, Sir Keir Starmer has announced.

Starmer revealed the plan to MPs during prime minister’s questions, seven months after AstraZeneca paused a planned £200m expansion of its Cambridge research site.

Starmer said the move would protect jobs in Cambridge, where AstraZeneca operates a global R&D facility, and in Macclesfield, which hosts a science, technology and manufacturing hub and is the company’s second largest manufacturing site.

Starmer told the House of Commons:

Today I can announce a significant new investment, by AstraZeneca, investing £300m in UK life sciences, made possible by the pharmaceutical arrangement we have struck with the United States, to future-proof thousands of jobs in Macclesfield and in Cambridge.

That is a major vote of confidence in the UK, and Labour’s plans to strengthen our economy.

Last September, AstraZeneca halted a planned £200m expansion of its Cambridge research site, which was seen as a blow to the UK pharmaceutical industry.

In January 2025, the company scrapped plans to invest £450m in its vaccine manufacturing facility in Merseyside, and blamed a cut in the funding on offer from the government.

Britain has asked UK refineries to maximise jet fuel supply as it continues to plan for a range of contingencies to increase flexibility on supply, the government said on Wednesday.

Energy minister Michael Shanks told MPs that the government has been “closely monitoring UK jet fuel stocks” since the closure of the strait of Hormuz last month, and is working with airlines, airports, fuel suppliers and international counterparts.

In a written answer, Shanks explained:

The Government continues to plan for a range of contingencies to increase flexibility on jet fuel supply, we have asked UK refineries to maximise jet fuel supply.

Airport Coordination Limited has updated its guidance to allow airlines to apply for slot alleviation, providing greater flexibility to plan flights. I encourage all passengers to check their rights before travelling and in the first instance to contact their airline, travel agent or tour operator where they have concerns.

We have published a fact sheet on GOV.UK that will be kept updated, alongside Foreign, Commonwealth and Development Office travel advice.

Shanks also points out that UK airlines typically buy fuel months in advance, and that aviation fuel suppliers hold bunkered stocks.

The UK also imports jet fuel supplies from a range of countries not reliant on the strait of Hormuz being open, including the United States, he adds, pointing out:

Airlines UK have stated that “UK airlines continue to operate normally and are not experiencing issues with jet fuel supply.” The Government continues to work with partners to monitor and mitigate potential disruptions.

Earlier this month, the head of a global energy watchdog warned that Europe only had six weeks of jet fuel left before shortages will hit because of the Iran war.

Russia is hoping that yesterday’s shock news that the United Arab Emirates is leaving the Opec+ group doesn’t prompt the end of the alliance.

Kremlin spokesman Dmitry Peskov said today that Russia will stay in Opec+, and hopes it will continue, Reuters reports.

Peskov argued that Opec+ played an important role, saying:

“This format helps to substantially, let’s say, minimise fluctuations in energy markets and makes it possible to stabilise those markets”.

The UAE sent shockwaves through the oil sector yesterday by announcing it was will quit the Opec oil cartel on Friday, in a heavy blow to the group and its de facto leader, Saudi Arabia

The shock loss of the UAE, Opec’s third-largest oil producer, is expected to weaken the group, which for decades has worked together to use its collective oil production to influence global oil market prices by setting quotas for its members.

Russia is a powerful member within Opec+, which is made up of Opec and its allies.

UAExit, as some wags have dubbed it, is a win for Donald Trump, who has previously accused Opec of “ripping off the rest of the world” by artificially inflating oil prices by holding back production.

Analysts have been speculating about which other Opec members could follow the UAE. Marketwatch reports that “Kazakhstan and perhaps Iraq” are seen as the two countries most likely to leave the oil bloc’s sphere.

The Iran war will knock £35bn off the size of the UK economy over 2026 and 2027, in a “best case” scenario where hostilities end soon.

That’s according to the National Institute of Economic and Social Research’s latest quarterly Economic Outlook, released this morning.

NIESR predicts that UK growth will stall in the second half of the year, as the Middle East conflict has “materially weakened the UK outlook” by pushing up global energy prices, raising inflation and reducing household spending power.

David Aikman, NIESR director, says:

“This is a serious blow to the government’s mission to get the UK economy growing again.

The Middle East conflict has laid bare the fact that the UK remains highly exposed to global energy shocks. Even if hostilities ease rapidly, higher energy prices will leave households poorer, businesses facing higher costs, and the economy materially smaller than we expected only a few months ago.”

The CEO of Adidas has revealed the company has faced difficulties getting products into the Middle East due to the Iran war.

Bjørn Gulden told reporters this morning:

“I don’t think we have any clear disruption now [due to the war], unless, of course, it’s difficult to get products in the Middle East.”

Gulden also flagged that transportation costs are “starting to explode” due to a surge in oil price – so he won’t be happy to see Brent crude up 3% this morning.

He was speaking after Adidas reported a rise in sales in the last quarter, with revenues up 14% and operating profits rising by 16%.

Economic confidence and employment expectations have punged across the European Union this month, as consumer confidence is hit hard by the Iran war.

The European Commission’s Economic Sentiment Indicator for the EU dropped by 2.9 points this month to 93.5 points, while its Employment Expectations Indicator fell by 4 points to 93.2, both below their long-term averages.

The decline of the ESI was driven by plummeting confidence among EU consumers, as well as managers in services and retail trade, while confidence in construction and industry held up broadly stable.

The EC adds:

Among the largest EU economies, the ESI deteriorated significantly in Germany (-3.9), France (-3.0), Italy (-2.8) and the Netherlands (-2.5), while it decreased less dramatically in Spain (-0.9) and Poland (-0.8).

Irish international sales, marketing and support services group DCC has received a takeover approach, sending its shares up 14%.

DCC has told the City that it has received an “indicative cash proposal” from a consortium made up of investment firms Energy Capital Partners, and Kohlberg Kravis Roberts.

It added:

The Board of DCC is evaluating the Proposal together with its advisers and a further announcement will be made in due course.

There can be no certainty that any firm offer will be made for the Company, nor as to the terms on which any firm offer might be made. Shareholders are urged to take no action at this time.

Shares in DCC, which has been valued at £4.6bn before the annoucement, have jumped to the top of the FTSE 100 risers.

The oil price has hit its highest level in a month, following reports that President Trump has instructed aides to prepare for an extended blockade of Iran.

Brent crude has risen by 1.8% this morning to above $113 a barrel, the highest since 31 March, a week before the US-Iran ceasefire was agreed.

Crude prices rose after the Wall Street Journal reported that Trump has decided to target Tehran’s coffers by squeezing Iran’s economy and restricting oil exports by preventing shipping to and from its ports, in an attempt to force it to dismantle all its nuclear work.

The WSJ reports:

He assessed that his other options—resume bombing or walk away from the conflict—carried more risk than maintaining the blockade, officials said.

Yet continuing the blockade also prolongs a conflict that has driven up gas prices, hurt Trump’s poll numbers and further darkened Republicans’ prospects in the midterm elections. It has also caused the lowest number of transits through the Strait of Hormuz since the war began.

Brent crude had been trading around $70 a barrel before the conflict began, before hitting $119.50 a barrel in mid-March.

Britain’s main stock index has dropped to its lowest level in almost a month, on a busy morning for corporate news.

The FTSE 100 share index dropped by 52 points, or 0.5%, in early trading to 10,280 points, its lowest level since 1 April.

Wealth manager St James’s Place are the top faller, down 6.3%, after reporting a drop in net inflows in the first quarter of 2026 amid “heightened geopolitical uncertainty and market volatility”.

British drugmaker GSK are down 2.7%, after reporting first-quarter profit and sales above analysts’ expectations. Fellow pharmaceuticals giant AstraZeneca (1%) are also among the fallers, despite beating profit expectations this morning thanks to strong demand for its cancer and rare-disease drugs.

Newsflash: The European Commission has preliminarily found Instagram and Facebook in breach of Europe’s Digital Services Act (DSA) for failing to protect minors.

The EC says the two services, both owned by Meta, failed to “diligently identify, assess and mitigate the risks of minors under 13 years old accessing their services”.

It is proposing that Instagram and Facebook must change their risk assessment methodology, and strengthen their measures to prevent, detect and remove minors under the age of 13 from their service.

In a statement outlining its preliminary findings, the EC says there are no effective controls to prevent a minor below the age of 13 from entering a false birth date, and labels Meta’s tool for reporting minors under 13 on the platform as “difficult to use and not effective”

Henna Virkkunen, executive vice-president for Tech Sovereignty, Security and Democracy, says:

Meta’s own general conditions indicate their services are not intended for minors under 13. Yet, our preliminary findings show that Instagram and Facebook are doing very little to prevent children below this age from accessing their services. The DSA requires platforms to enforce their own rules: terms and conditions should not be mere written statements, but rather the basis for concrete action to protect users – including children.

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 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.”

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 interest rate decision

• 7.30pm BST: Federal Reserve press conference