The United Kingdom risks slipping into recession in 2027 if the Strait of Hormuz remains closed to commercial shipping beyond the middle of next year, according to a stark new forecast from accountancy firm EY.
The warning highlights the severe macroeconomic vulnerability of Western economies to prolonged disruption in one of the world’s most critical energy transit corridors.
EY’s analysis suggests that the economic damage from a sustained closure would be profound, extending beyond the UK to major European economies.
The firm estimates that gross domestic product in these regions could contract this year if the strait does not resume full operations by mid-October.
This timeline underscores the immediate pressure on policymakers and central banks to manage the fallout from escalating geopolitical tensions in the Persian Gulf.
The Strait of Hormuz serves as a vital artery for global oil and gas flows, with a significant portion of the world’s crude supply passing through the narrow waterway daily.