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The impact of current global events on the insolvency sector
May 26, 2026
By Kate Heaney
The tensions in the Middle East have contributed to existing pressures on the British economy, as statistics now show that UK businesses and individuals are starting to feel the effect.
However, experts are claiming that it is still too early to determine its full impact and that further distress can be expected if the conflicts are not resolved soon.
According to the International Energy Agency, conflicts in the Middle East have triggered the biggest supply disruption in the global oil market’s history, with the attacks on Iran’s oil infrastructure and the cessation of tankers passing through the Strait of Hormuz causing oil prices to soar. The UK and Italy, as a result of their reliance on gas-fired power, are especially feeling the effect of this economic shock. Consequently, businesses have seen their operating costs increase, particularly those with energy-intensive operations, causing an increase in businesses seeking insolvency advice.
This is especially the case for business who are already on the brink. Data from the Insolvency Service confirms that 2,022 corporate insolvencies were registered across England and Wales in March 2026, a 7% increase from the month before.
Company insolvencies in March 2026 consisted of 299 compulsory liquidations, 1,468 creditors’ voluntary liquidations, 235 administrations and 20 company voluntary arrangements. The data suggests that businesses continue to primarily rely on creditors’ voluntary liquidations, but there has been an increasing shift towards court driven insolvency procedures, with compulsory liquidations and administrations representing the largest increase since February. Compulsory liquidations were at their highest level since October 2025, and administrations have increased 52% since the month before.
From a personal insolvency perspective, as rising living costs erode salaries and savings, and the increasing operational costs for sole traders, individuals may be experiencing greater difficulty maintaining consistent repayment of outstanding debts.
In March 2026, 12,252 personal insolvencies were registered across England and Wales, representing an increase of 3% from the previous month. Strikingly, there has been an increase of 30% in personal insolvencies when compared to the corresponding data from March 2025.
Personal insolvencies in March consisted of:
Notably, DROs are the dominant personal insolvency solution, reaching a record monthly high in March, since their introduction in 2009.
Although the long-term economic impact of the conflicts remains uncertain, the latest insolvency figures suggest that geopolitical instability is now having tangible consequences for UK businesses and consumers alike.
For organisations already facing financial pressure, rising operational costs and continued market uncertainty may quickly intensify existing difficulties. Likewise, individuals dealing with increased household expenses may find themselves struggling to manage debt repayments and other financial commitments.
The key takeaway, as individuals and companies continue to feel the consequences of the conflicts, is that the availability of clear and pragmatic advice is more important than ever. Expert guidance can help those affected to find a solution to their financial difficulties.
If you have any questions or concerns regarding this article, or need any help or advice on an insolvency-related matter, please contact one of our insolvency specialists on 02920 829 100 for a free initial chat or via our Contact Us form.
To speak to one of our experts today, please contact us on 02920 829 100 or by using our Contact Us form for a free initial chat to see how we can help.
