UK Exports to Middle East Drop 20% Since Iran War Began

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.

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