UK impacts of the US-Iran conflict

This project will examine how linked administrative and public datasets can identify households and places exposed to rises in energy, fuel, and essential costs. The research will assess which households are most vulnerable, which groups risk being missed, and what local and national responses are feasible. The findings will clarify the choices and trade-offs facing policymakers, including speed versus accuracy in targeting, broad eligibility versus precise support, privacy and public benefit, local administrative capacity, and fiscal costs compared with the prevention of deeper hardship. This project is led by Francisca Torres Cortes. (£37,500)

Are UK households using AI to navigate the energy crisis, and for which decisions? The project will determine which groups rely most on AI advice and which are most exposed to its errors. The quality of the advice provided by LLMs and their sensitivity to the framing of questions will be measured by auditing AI responses for factual grounding, context-sensitivity, caution, and actionability for non-experts facing urgent choices. This project is led by Jacek Pawlak. (£39,933)

This project will produce tools policymakers can use to see which firms are most affected and how they respond in real time. It will answer four related questions: which UK firms and sectors are most exposed to the 2026 energy shock; how are highly exposed firms responding in real time over the course of 2026; how fast and how fully does the energy input cost shock pass through supply chains into final output prices; and what do the exposure and passthrough findings imply for the likely costs and benefits of government support for firms? This project is led by Jakob Schneebacher. (£51,449)

What is the impact of the US-Iran crisis on the cost of living? This project will provide a complete and forensic analysis of the cumulative impact of these shocks, the adjustment by households so far, and the extent of the hardship caused. Evidence of the distributional impact will be combined with assessments of the fiscal constraints facing the government to develop policy measures aimed at boosting living standards. This project is led by Mike Brewer. (£40,651)

The US–Iran conflict has disrupted Gulf shipping and sharply raised natural gas prices, doubling urea prices and threatening the supply of nitrogen and phosphate fertilisers on which UK food production depends. The UK’s direct trade exposure to the Gulf is minimal, however, fertiliser is a global commodity. Therefore, bilateral exposure analysis systematically understates UK vulnerability. This project will examine which UK importers and supply chain segments are most exposed to fertiliser and energy shocks, how vulnerabilities to cost shocks propagate to downstream supply chains and consumers, and which policy instruments would most cost-effectively mitigate the shock. This project is led by Oleksandr Shepotylo. (£50,000)