Hormuz Closure Threatens UK Economy with 2027 Recession

Britain's economy is expected to face a recession in 2027 if the Strait of Hormuz remains closed for an extended period, according to Ernst & Young (EY) UK Chief Economist Peter Arnold.

The Strait of Hormuz has been closed since February 2026, with brief reopenings in June and July. The closure is driving up petrol prices, which are affecting many businesses and leading to inflation of consumer goods and food.

According to EY, Britain's growth will slow down by 0.5% if the strait remains closed, while the economy will be down by 0.2% by 2027. Inflation is expected to rise to 6.4% in that scenario.