Iran war blows a near-£12bn hole in Britain's public finances as oil markets brace for peace talks

From the Newshound archive · first published 9 October 2026.

The Iran war has torn a near-£12bn gap in the UK's public finances, piling fresh pressure on a government already struggling to balance the books. Oil prices fell today after President Trump signalled progress in Iran negotiations, easing some supply fears. Aid cuts and shipping disruptions linked to the conflict are also squeezing contraception supplies across sub-Saharan Africa.

The £12bn shortfall threatens to force fresh tax rises or spending cuts on a Labour government with little room to manoeuvre.

Oil prices dropped after Trump's comments on Iran talks raised hopes of a diplomatic resolution that could ease supply disruptions.

Around 180,000 pregnancy deaths occur across sub-Saharan Africa each year, with the UN warning aid cuts will leave a $185m contraceptive funding shortfall globally this year.