Iran’s fuel blockade is now showing up in UK shopping baskets
High street sales growth slowed sharply to just 0.8% in March 2026, well below inflation, as the fallout from Iran’s fuel blockade began feeding through to higher prices and squeezed household budgets.
According to the latest BDO High Street Sales Tracker, which monitors like-for-like sales across around 10,000 mid-tier retail stores, the UK’s retail sector is showing clear signs of strain. Store sales actually fell -0.1%, while non-store channels (online and mail order) grew +4.8%, down from +6.1% last year.
The monthly picture masks an even more dramatic collapse at the end of the period. Sales surged in the first two weeks, +3.20% and +9.85% respectively, helped by a dry, bright start to March and strong fashion demand.
But momentum evaporated in weeks 4 and 5, with declines of -3.04% and -7.74%. Week 5 was described as “one of the worst-performing weeks in some time.”
Category performance was mixed but mostly disappointing:
- Fashion was the relative bright spot, rising +2.6% (versus +3.7% last year). Non-store fashion jumped +6.4%, but even here growth slowed sharply after week 2.
- Lifestyle (gifts, health & beauty, leisure) dropped -1.5%, worse than the -0.3% recorded in March 2025.
- Homewares slipped -0.5% against +1.2% growth a year ago.
Footfall was negative for the month overall, though there was a brief respite in week four when high-street visits rose +4.2%. That proved too little, too late to offset a brutal -7.7% drop in week five.
The report leaves little doubt about the culprit.
“A worsening global economic outlook from the ongoing war in Iran” and the resulting “Iran’s fuel blockade” pushed retail price inflation from +1.1% in February to +1.2% in March, according to the British Retail Consortium.
The Consumer Prices Index (CPI) rose +3.0% and CPIH +3.2% in the year to February, with clothing adding the biggest upward push.
Consumer confidence has also deteriorated. The GfK index fell to -21 in March, its lowest level since April 2025, as households brace for higher costs. Cornwall Insight is now forecasting that the typical dual-fuel household energy bill will jump +18% to £1,929 a year from July under the default tariff cap.
