Business group Logistics UK is urging Chancellor Rachel Reeves to use her Spring Forecast to bolster business confidence and supply chain resilience in the wake of the current Middle East conflict, including by reviewing her decision to begin increasing fuel duty this year.
As Ben Fletcher, the organisation’s Chief Executive explains, the conflict has already begun impacting supply chains through the closure of the Strait of Hormuz and the cancellation of flights, which will increase prices as a result of disruption, rerouting and higher insurance premiums. The Strait of Hormuz is a critical point for global shipping, and the movement of crude oil in particular:
“Approximately one fifth of the world’s oil supplies move through the Strait of Hormuz every single day and with this shipping corridor disrupted, the global price of oil is already climbing: this increased cost will soon be seen at the UK’s pumps. Our sector, which delivers all the goods that the UK relies upon every day, already operates on incredibly narrow margins and any significant fuel price rises would have to be passed on to the customer. We are therefore urging the Chancellor to focus on bolstering business confidence and supply chain resilience, including by reviewing her decision to begin increasing fuel duty this year (as announced in the 2025 Autumn Budget), to prevent further inflationary pressure at a time when the global economy is so disrupted.”
“The escalating military situation in the Middle East risks seriously impacting international trade. As a sector, logistics is flexible and is already seeking alternative routes but there will be an impact on the UK’s supply chain across the summer on those goods which arrive in the UK by sea. We are maintaining close contact with government to monitor developments and help mitigate the impact of these disruptions on UK businesses and consumers, and the risks to logistics personnel operating across the Middle East.”
Logistics UK is one of the UK’s biggest business groups, representing logistics businesses which are vital to keeping the UK trading, and more than seven million people directly employed in the making, selling and moving of goods. With decarbonisation, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, logistics has never been more important to UK plc. Logistics UK supports, shapes and stands up for safe and efficient logistics, and is the only business group which represents the whole industry, with members from the road, rail, water and air industries, as well as the buyers of freight services such as retailers and manufacturers whose businesses depend on the efficient movement of goods. For more information about the organisation and its work, please visit logistics.org.uk
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