The interruption of oil and gas supplied through the Strait of Hormuz, a critical shipping route, has dramatically pushed up global energy prices.

As we've just reported, the International Monetary Fund has suggested the UK, as a net importer of energy, remains sensitive to rapid rises in energy prices.

Crude oil is a key ingredient in petrol and diesel, meaning higher wholesale costs make filling up a car more expensive. A global market determines its price.

Significant levels of caution in IMF forecastpublished at 14:18 BST 14 April

14:18 BST 14 April

Faisal Islam
Economics editor

The IMF has put in a significant level of caution on its forecast given the uncertainty of events in the Gulf.

Its numbers rely on a relatively fast resolution to the conflict by the second half of the year.

Before the war, the Fund had expected to upgrade economic prospects, as US President Donald Trump's trade tariffs were now lower than planned, and China, Europe and Canada had simply traded more with each other to make up for US declines.

But now, the IMF said "the global economy is threatened with being thrown off course".

The economies of many Gulf nations such as Iran, Iraq, Qatar and Bahrain are expected to contract this year.

In more severe scenarios, with the oil price averaging $110 a barrel and $125 next year, and energy prices and interest rates continuing to rise, a global recession would be a "close call".

Faisal Islam
Economics editor

The energy shock from the Iran war will hit the UK the hardest of the world's advanced economies, the International Monetary Fund (IMF) has forecast.

In its latest World Economic Outlook, the IMF cut its estimate for UK growth this year to 0.8%, from the 1.3% prediction made in January before hostilities began.

The Fund said the downgrade was due to the war, fewer interest rate cuts, and the expectation that the impact of higher energy prices would linger into next year.

It also warned the war threatened to throw the world economy "off course" and a prolonged conflict risked a global recession. The IMF urged central banks to be cautious over raising interest rates to counter higher inflation.

• You can read more on the potential impact to the UK economy here

Image source, Getty Images

Iran has been undertaking assessments of the cost of the damages caused by the war as part of its effort to make reparations a part of negotiations, reports the IRGC-affiliated Tasnim news agency.

Speaking to Russian media, Iranian government spokesperson Fatemeh Mohajerani says a "preliminary" and very rough estimate puts the figure at around $270bn (£189bn) so far, but that it could change.

She adds officials in Iran are continuing to make assessments, which she says includes looking at damage to buildings and lost revenue from industrial shutdowns, according to Tasnim.

Reparations were one of the issues raised in talks with the US over the weekend, Mohajerani says, according to a report of her comments from Iran's state-run IRNA.

US Vice-President JD Vance previously said there had been "substantive discussions" at the talks in Pakistan but that no agreement was reached.

Our colleagues at BBC Persian have been speaking to young people in Iran about the latest developments in the war.

"I'm tired. Very tired," said one man, who is in his 20s and based in Tehran. He says he fears another phase of war starting, because "we're supposed to be in the prime of our youth, but we're spending it like this".

Another man in his 30s, in the Gilan province, says he doesn't believe "either side is determined enough to stop the war".

He says he's now unemployed, and one of his friends, who works in search engine optimisation, was laid off due to the government's ongoing internet blackout.

A woman in Tehran, who is in her 20s, says "it really upsets me when I think about how people my age are living in other countries".

"Yes, maybe things will be better by the time I'm 40. But I won't be in my 20s anymore," she tells BBC Persian. "I just hope the next generation after us will have a better life."

Image source, Reuters

Iran's state-run IRNA says that messages have been exchanged between Tehran and Pakistan - which has been acting as a mediator - but there is "no information" about any agreement to hold further talks with the US.

Citing a diplomatic source, it says the messages are about "current developments" after previous talks with the US faltered over the weekend.

Earlier, the news agency Reuters reported that negotiating teams from the US and Iran could return to Islamabad this week to resume talks to end the war, citing sources involved in the talks.

Donald Trump announced a two-week ceasefire on 8 April - meaning it is due to expire on Wednesday, 22 April.

Image source, Reuters

• At least four Iran-linked ships crossed the strait on Tuesday following the start of the US imposed naval blockade at 10:00 ET (14:00 GMT) on Monday, shipping data analysed by BBC Verify shows
• China's foreign ministry has condemned the US blockade as "dangerous and irresponsible", with spokesman Guo Jiakun saying it would only "exacerbate tensions and undermine the already fragile ceasefire agreement"
• The blockade has been called a "grave violation" of Iran's sovereignty by the country's ambassador to the United Nations, Amir Saeid Iravani, who said the measure was "unlawful"
• Italian PM Giorgia Meloni says the country is suspending its defence agreement with Israel, according to Italian media
• Lebanese and Israeli ambassadors to the US are expected to meet in Washington later today for face-to-face negotiations regarding the ongoing conflict in Lebanon - US Secretary of State Marco Rubio is also expected to attend

At least three ships with no obvious Iran links cross the Strait of Hormuzpublished at 12:14 BST 14 April

12:14 BST 14 April

By Joshua Cheetham

Earlier we reported that ship-tracking shows four Iran-linked vessels appear to have transited the Strait of Hormuz since the start of the US naval blockade.

But not all vessels crossing the strait are connected to Iran - using ship-tracking data, we’ve identified at least three that have crossed since the start of the blockade on Monday which have no obvious links to the country.

However, our understanding of which ships are going through the strait is complicated by the fact that some vessels may have been "spoofing" their tracking signal to hide their position. This also means some ships may have concealed the ports they called at so we cannot always say in which country they loaded or unloaded cargo.

Crossings of the Strait of Hormuz are currently a fraction of what they were before the war when an average of 138 ships would transit the waterway each day.

Laura Gozzi
Europe reporter

Image source, Getty Images

Italy is not renewing its defence agreement with Israel, Italian Prime Minister Giorgia Meloni has said.

Meloni said her government had decided to suspend the renewal, which happens every five years, "in view of the current situation”, without specifying what she was referring to.

But relations between Rome and Tel Aviv have recently been fractious.

Last week, Italy summoned the Israeli ambassador in Rome after warning shots were fired by Israeli forces at a convoy of Italian UN peacekeepers in Lebanon, damaging one vehicle but causing no injuries.

And on Monday, Israel summoned Italy’s ambassador to protest comments by Italian Foreign Minister Antonio Tajani who condemned Israel's "unacceptable attacks" on civilians in Lebanon and said that “another escalation like in Gaza must be avoided at all costs".

Other European countries have also paused or restricted arms exports with Israel. Italian opposition parties had long called for Italy to do the same. In recent years, hundreds of thousands of Italians have taken to the streets or gone on strike to protest Israel’s actions in Gaza and Meloni’s reluctance to join the growing number of countries recognising Palestinian statehood.

Italy is the third-biggest arms exporter to Israel, according to the latest figures from the Stockholm International Peace Research Institute (Sipri).

But that still only accounts for 1.3% of Israeli arms imports between 2021-2025. The US and Germany are the top exporters.

Davide Ghiglione
Reporting from Rome

As we just reported, Italy's PM Giorgia Meloni said on Tuesday Italy is suspending its defence agreement with Israel, covering the exchange of military equipment and joint research.

“In view of the current situation, the government has decided to suspend the automatic renewal of the defence agreement with Israel,” Meloni said on the sidelines of an event in Verona, according to news agency ANSA.

The longstanding agreement, automatically renewed every five years by governments of all political stripes, had been in place long before the war.

While we're keeping an eye on the situation in the Strait of Hormuz, there's breaking news from Italy.

Italian Prime Minister Giorgia Meloni says she is suspending Italy's defence agreement with Israel, local news agencies have reported.

She also says "every possible effort" must be made to reopen the Strait of Hormuz, speaking to reporters in Verona on Tuesday.

Iran's President Masoud Pezeshkian says Iran is ready to continue peace talks - and that diplomacy is its preferred path to resolving disputes - in a conversation with French President Emmanuel Macron reported by several news outlets in Iran.

Pezeshkian reportedly told Macron that threats, pressure and military action are "unhelpful" and will worsen the US's "self-created problems".

Pezeshkian added that Europe should encourage the US to adhere to international laws and regulations.

As we just reported, Iran-linked tankers have passed through the Strait of Hormuz, despite the US blockade being in place.

However, the US is not, technically, blockading the Strait of Hormuz, instead aiming to blockade Iran’s Gulf ports by operating its navy in the Gulf of Oman and the Indian Ocean, rather than risk its vessels close to Iran's coast.

The BBC's security correspondent Frank Gardner explains how it will work and its potential impacts across the globe.

Four Iran-linked ships transit Strait of Hormuz, tracking showspublished at 10:27 BST 14 April

10:27 BST 14 April

By Joshua Cheetham and Shruti Menon

Ship tracking data analysed by BBC Verify shows four Iran-linked ships have crossed the Strait of Hormuz despite Washington’s naval blockade beginning.

Two of those ships had visited Iranian ports according to MarineTraffic. Its data shows a bulk carrier, Christianna, crossed the strait on Monday after the blockade began having called at Iran’s Bandar Iman Khomeini, according to ship-tracking data.

The Rich Starry, sanctioned by the US for Iran-related trade, sailed east from Sharjah in the UAE through the strait overnight, data shows.

The tanker Murlikishan, which is also under US sanctions for Iran-related trade, sailed from Lanshan in China and headed west through the strait overnight. According to MarineTraffic its last reported position was east of Iran’s Qeshm island.

Another tanker, Elpis, passed the strait heading east overnight having come from the Iranian port of Bushehr, tracking shows. It is also under US sanctions and its destination is unknown.

It is possible these ships have been broadcasting false position reports - known as “spoofing” - to disguise their locations.

The US military has said that, from 14:00 GMT on Monday, it would blockade "all maritime traffic entering and exiting Iranian ports". It said it would "not impede freedom of navigation for vessels transiting the Strait of Hormuz to and from non-Iranian ports.

Dearbail Jordan
Senior business and economics reporter

In March, Iran had one of its biggest months for oil exports despite the key Strait of Hormuz shipping route being virtually closed to most vessels under the threat of attack.

Figures show that Iran exported 57.9 million barrels of last month, according to shipping analysts at Kpler. That was the fifth biggest month for oil exports from Iran over the past year and a half.

China is a major customer of Iran and on Tuesday, its foreign ministry called the US blockade “dangerous” and “irresponsible”.

The International Energy Agency has made large cuts to its forecasts for global oil demand and supply, citing disruption in the Middle East.

The Paris-based watchdog says "demand destruction" - a permanent decline in consumer demand that struggles to recover - will spread as "scarcity and higher prices persist".

Global oil demand is projected to decline by 80,000 barrels per day in 2026, a sharp contrast to last month's forecast that had predicted a 640,000 barrels per day rise.

The IEA also expects oil supply to fall by 1.5 million barrels per day this year, compared to an increase of 1.1 million projected last month - marking the sharpest decrease since Covid-19.

That's as oil prices saw their largest ever monthly gain in March, as a result of what the IEA calls "the most severe oil supply shock in history."

Dearbail Jordan
Senior business and economics reporter

Stock markets in Europe opened a little higher on Tuesday, buoyed by a possible second round of peace talks between the US and Iran which sent oil prices lower.

In the UK, the FTSE 100 share index rose 0.36% in the first hour of trading. Germany Dax index gained 1% and in France, the Cac-40 rose by 0.58%.

Oil prices fell by 1% to $98.56 a barrel.

Image source, EPA-EFE/Shutterstock

China's foreign ministry has condemned the US blockade of Iranian ports as "dangerous and irresponsible".

The blockade came into force on Monday, a day after peace talks between the US and Iran broke down in Pakistan.

Chinese foreign ministry spokesman Guo Jiakun warned that the blockade would only "exacerbate tensions and undermine the already fragile ceasefire agreement".

"This is dangerous and irresponsible behaviour", Guo told a news conference.

Guo said reports that China was preparing to deliver new air defence systems to Iran were "completely fabricated".

The reports prompted US President Donald Trump to threaten to impose a 50% tariff on China's goods if it provided military assistance to Tehran.

"If the US insists on using this as an excuse to impose additional tariffs on China, China will definitely take resolute countermeasures," Guo said.

The BBC's diplomatic correspondent James Landale says China, which gets a large amount of its oil from Iran, "has an interest in this conflict ending and returning stability to the international market".

Another US-sanctioned tanker crossed Strait of Hormuz, tracking showspublished at 09:12 BST 14 April

09:12 BST 14 April

By Joshua Cheetham

BBC Verify has confirmed reports that a US-sanctioned tanker crossed the Strait of Hormuz after Washington’s naval blockade began.

Data from MarineTraffic shows the Comoros-flagged ship Elpis is partially laden with cargo which may have been loaded at the Iranian port of Bushehr.

Its registered owner is a Malaysian firm called Chartchemical. Shipping database Equasis reports the ship is falsely-flagged, meaning it is sailing under the flag of Comoros without that country’s authorisation.

Image source, MarineTraffic

It last displayed its location at 10:00 local time (06:00 GMT; 07:00 BST) and has no destination recorded publicly.

As we reported earlier, tracking data also appears to show another US-sanctioned tanker, Rich Starry, has passed through the strait and is reportedly heading for China, external, having last stopped in the UAE.

• When announcing the blockade of Iranian ports, the US military said it would "not impede freedom of navigation for vessels transiting the Strait of Hormuz to and from non-Iranian ports"

Image source, Reuters

Hapag-Lloyd - one of the world's biggest shipping firms - has six vessels stuck at different points along or near the Strait of Hormuz.

Speaking from Hamburg, Nils Haupt tells the BBC: "We keep on waiting for the opening of the Strait of Hormuz and we very much hope this is going to happen in the next [few] days - but we basically do not know."

He also talks about the "very brave" crew on the stuck ships.

"Being caught up in the Gulf at the moment and seeing a war around you and sometimes at night, this is a kind of traumatic experience for many of them and they are not used to it. Times are not easy for the crews."