Leaders of Britain's Largest Companies Are Now More Worried About the Economy Than They Have Been for Six Years, Mainly Due to Rising Energy Costs from the Iran Conflict

A new survey of the top finance bosses at many of the UK's biggest companies (including those on the FTSE 100 and 250 stock market lists) has found that their overall confidence in the economy has dropped dramatically. In the second half of March 2026, their "net confidence" score fell to a very negative -57%. This is much worse than the -13% seen at the end of 2025 and is the lowest level recorded since the early days of the COVID-19 pandemic in 2020.

The main reason for this big drop in optimism is the conflict in the Middle East involving Iran, which has caused oil and gas prices to surge sharply. Bosses are worried that these higher energy costs will push general prices (inflation) up across the economy, which could then force the Bank of England to keep interest rates high or even raise them. Higher borrowing costs make it more expensive for companies to take out loans for new equipment, buildings, or expansion. About 61% of these finance leaders said they are very concerned about energy prices and the knock-on effects. They now expect inflation to be around 3.6% in a year's time — higher than they thought before.

Because of all this uncertainty, many companies are switching to a "safety first" approach. They are cutting costs wherever possible, being very careful about hiring new staff (most now expect fewer people to be employed over the next year), and holding onto more cash in the bank instead of spending it on new investments or extra projects. Deloitte's chief economist noted that finance bosses have rarely been so focused on controlling costs in the last 16 years.

This kind of low confidence among big business leaders can have wider effects: companies might delay growth plans, which could slow down job creation and overall economic activity in the UK. The survey was conducted between 16–30 March 2026 and reflects the growing worries just as fuel prices at UK petrol stations continued to climb due to the same global energy disruptions. Related BBC reporting around the same time highlighted how these higher petrol and diesel prices (up for many days in a row) are also feeding into household energy bills and making families more cautious with their spending.