Joanna Partridge

Ofwat is considering allowing water companies in England and Wales to factor water scarcity into customer charges during droughts, a model likened to surge pricing. Five companies have also been authorized to raise bills beyond previous plans to fund repairs and infrastructure. Several suppliers are trialling alternative tariffs, including higher charges for heavy use and seasonal pricing, while South West Water says most participants would pay less under its rising-block scheme. The proposals come amid drought conditions, widespread public anger over rising bills, sewage pollution, executive pay and dividends, and criticism of persistent leaks. The government says there are no plans for nationwide surge pricing and that any new structures must make bills fairer and more affordable; consumer representatives likewise stress protections for struggling households and greater access to usage data.

Shipping costs and waiting times at the Panama Canal are rising as vessels avoid Gulf and Red Sea routes because of the Iran war and as El Niño reduces water levels. A container ship reportedly paid about $4 million at auction to bypass the queue, where vessels are waiting around 10 days. The Panama Canal Authority has reduced permitted ship drafts and may impose further transit limits to protect traffic flows, while similar drought-related disruptions are affecting cargo movement on Europe’s Rhine River.

Thousands of seafarers remain stranded on hundreds of vessels in the Gulf after entering through the Strait of Hormuz in February, with Iranian blockades and renewed hostilities sharply reducing traffic. A recent attack on the Minoan Pioneer caused a fire and left its third engineer missing, highlighting the dangers facing crews who are not trained or equipped for combat. Around 6,000 seafarers on 500 vessels are still trapped, while 17 have died since the conflict began. Ceasefires and a June peace deal briefly enabled some ships to leave but collapsed, and proposed Oman-mediated arrangements that would give Iran control over Gulf-bound traffic have raised concerns among shipowners. Uncertainty and prolonged confinement are causing serious psychological strain, while the broader conflict threatens to worsen a global shortage of seafarers and disrupt the transport of most of the world’s goods.

Drought and sustained extreme heat have sharply reduced UK vegetable yields, pushing restaurants, pubs and supermarkets to import broccoli and lettuce from Spain during the normal domestic growing season. Wholesale prices have risen significantly, with tomatoes up more than 60%, iceberg lettuce 90% and potatoes over 40%. Growers report that broccoli yields have halved, the English pea harvest is down by a third, and carrot supplies could run out months early. Industry leaders are urging the government to treat food security as a national priority and help farmers build reservoirs, while growers consider heat-tolerant crop varieties and warn that European imports may also be constrained by the wider heatwave.

UK house prices rose just 0.1% in July to an average of £277,542, while annual growth slowed to 1.8% from 2.2% in June. Buyers remain cautious amid volatile interest-rate expectations, geopolitical tensions and inflation concerns. The Bank of England held rates at 3.75% but warned that escalation in the Iran conflict could push inflation above 4% next year. Taylor Wimpey reported weaker demand and higher construction costs, while estate agents described a market with more sellers than buyers. NatWest said mortgage activity briefly surged as borrowers sought to lock in rates before returning to more normal levels.

Oil prices rose from $95 to above $100 a barrel as Houthi attacks on two Saudi oil tankers heightened fears of disruption through the Red Sea, while tensions over Iranian oil flows through the Strait of Hormuz intensified. Analysts warned that prices could reach $120, reviving inflation and economic risks. Global shares declined, with the Nasdaq falling more than 2% and Tesla dropping 12% after disappointing profits. Government bond yields also rose as investors anticipated renewed inflation and borrowing pressures, while the International Energy Agency cautioned that the market had little room for complacency.

Renewed US attacks on Iran and Houthi strikes on tankers near Yemen pushed Brent crude close to $100 a barrel, raising UK petrol and diesel prices and increasing fears that energy-driven inflation could force central banks to raise interest rates. The conflict has disrupted shipping through both the Bab el-Mandeb and Strait of Hormuz chokepoints. Elsewhere, the EU fined Google €890m over alleged search and app-store competition breaches; Ford and Geely agreed to share production at Ford’s Valencia plant; and easyJet reported a 70% profit decline as fuel costs surged. UK carmakers lobbied against the planned 2035 ban on new petrol and diesel cars, while Centrica announced 1,300 job cuts despite a return to profit. Prime Minister Andy Burnham also announced a 20% business-rates reduction for pubs, clubs and live-music venues, though hospitality groups said restaurants, cafés and hotels were unfairly excluded.

EasyJet reported a sharp 70% fall in quarterly profits as surging fuel costs and later customer bookings linked to the conflict in Iran increased expenses and reduced earnings. Competing takeover bids from Castlelake and Apollo Global Management face uncertainty amid a potential EU review of airline ownership rules. Ryanair also reported lower profits because of higher jet fuel prices. Despite financial pressures, easyJet noted improving late booking demand, and its shares rose following earlier losses tied to concerns over EU regulatory changes.

Segro’s board has unanimously agreed to recommend Prologis’s revised £14bn takeover offer, valuing the UK warehouse landlord at £10.32 a share and representing a 9.5% premium to Prologis’s initial proposal. The offer includes new Prologis shares and a permitted dividend, while Segro has sought a secondary London listing. Prologis’s takeover-code deadline has been extended to 12 August. The reversal followed pressure from major investor Norges Bank Investment Management and comes amid a broader wave of overseas bids for UK-listed companies. Both companies are expanding warehouse and datacentre operations to benefit from demand linked to e-commerce and artificial intelligence.

Europe’s June heatwave is estimated to have destroyed 9 million tonnes of grain and cost farmers about €2bn in lost revenue, potentially making the EU and UK’s combined harvest their smallest since 2018. France is expected to suffer the largest losses, followed by Hungary and Spain, while UK farmers face severe dryness and uncertain yields. The reduced harvest could increase Europe’s reliance on imports and push global grain prices higher as supplies also tighten because of drought in the United States.

Thames Water increased bonuses for senior managers from £2.8m to £4.1m and paid chief executive Chris Weston a previously deferred £99,000 bonus despite a government ban linked to pollution failures. The financially distressed company reported net debt of £19.7bn, up from £17.7bn, and warned of material uncertainty while seeking a recapitalisation deal to avoid nationalisation. It said it had enough funding to continue until the end of the year and reported underlying profit after tax of £204m, up from £13m, after Ofwat-approved bill increases. Although pollution fell 18% and performance improved, Thames met only 55% of Ofwat targets, while billing complaints more than doubled. Environment secretary Emma Reynolds condemned the bonuses and objected to a proposed £10bn investor-led rescue, while Andy Burnham has indicated that temporary government control may be considered.

A record-breaking heatwave continued across Europe, with the UK June temperature record exceeded for the third consecutive day after a provisional 37.3C reading in Suffolk. Red heat warnings, elevated ozone pollution, disrupted health services, school closures and pressure on electricity supplies highlighted the event’s broad impacts. Spain reported 327 heat-related deaths since Sunday, while France reported 55 drownings during the heatwave and a fourth child death. The heat is moving east toward the Balkans, where temperatures could reach 39C, while Germany and Poland may approach or exceed 40C; Poland also warned that low rainfall and extreme heat have sharply increased wildfire risk. Paris postponed its Pride march, Belgium cancelled a Waterloo reenactment, and Italian courts and cultural institutions restricted access. Experts attributed the increasingly intense heatwaves unequivocally to human-caused climate change and warned that low-income families, women and other vulnerable groups face the greatest difficulty adapting.

Extreme heat is disrupting workplaces, commuting, schools and production across the UK and western Europe, with construction, agriculture, manufacturing, retail and hospitality especially exposed. Economists estimate that a four-day heatwave could cut quarterly labor-productivity growth by 1.5 percentage points in the UK and up to two points elsewhere in western Europe, while Allianz estimates that France, Italy and Spain could collectively lose hundreds of billions of dollars in output through 2030. Employers are adopting earlier shifts, extra breaks, cooling measures and remote work where possible, but protections remain unequal because many frontline workers cannot work remotely. The UK has no maximum legal workplace temperature, prompting unions to call for stronger rules, while France, Germany and Spain have introduced more explicit heat-related requirements and leave provisions.

Great Britain’s National Energy System Operator is expected to spend about £10m securing additional electricity after extreme heat increased demand for fans and air conditioning while low wind and power-plant outages reduced generation. Neso issued a rare summer margin notice seeking 1,900MW of extra capacity, later securing about 1.7GW of imports at roughly £1,400 per megawatt-hour. The warning was cancelled, and Neso said electricity supplies were not at risk and a blackout was not imminent. Heat-related demand, reduced renewable output and lower French nuclear generation have pushed European power prices to multiyear highs.

Segro has unanimously rejected a £12.6bn all-share takeover proposal from US warehouse operator Prologis, saying the implied value of 925p per share falls well short of its own assessment. The offer represented a 24.6% premium to Segro’s closing price, prompting its shares to rise 17.5%, but the company argued that Prologis was exploiting depressed UK and European property valuations. Segro’s warehouses, development pipeline and growing data-centre portfolio have attracted Prologis, while analysts said the bid could trigger wider interest in UK real-estate investment trusts and further reduce the number of major companies listed in London if successful.

A Defra-funded Slimers project has developed computer-generated maps predicting where slugs will cluster in arable fields. Data gathered by 28 farmers working with scientists enabled 16 growers to test the maps, reportedly halving their use of slug pellets while maintaining more targeted pest control. The project, led by the British On-Farm Innovation Network with researchers from Harper Adams University, also found that slug populations form patches linked to soil and weather conditions. Researchers are developing slug-resistant wheat varieties after identifying three relevant areas of the wheat genome, offering a potential longer-term alternative to pesticide use.

A decade after the UK’s 52%-48% vote to leave the EU, five emblematic subjects illustrate Brexit’s complicated legacy. Nissan’s Sunderland plant survived through state aid but production has fallen sharply and faces continued barriers to EU trade. Fishing communities gained control over stocks but saw little improvement, while EU access to British waters and tighter immigration rules have fueled resentment. Blue passports delivered a symbolic victory but brought additional border checks, fees and travel friction. Care homes lost access to many European workers, worsening vacancies and increasing reliance on recruitment from outside Europe before new immigration restrictions tightened. London’s financial sector avoided the mass exodus once predicted, but firms incurred extra costs and duplicated operations. Overall, the examples suggest Brexit produced limited symbolic gains alongside persistent economic, labor and regulatory complications.

Around 80 mines reportedly laid by Iran in the central Strait of Hormuz are preventing the return of normal shipping despite a US-Iran memorandum of understanding and a ceasefire. Vessels are using a narrow route close to Oman, increasing the risks of grounding, collision and navigational failure caused by signal jamming. Nearly 600 ships remain stranded in the Gulf, while the blockade affects roughly 10% of global container capacity and had previously restricted a route carrying about 20% of the world's oil. Shipping experts expect the disruption and freight-rate volatility to persist for months, potentially through the year. Iran's plan to impose maritime fees after a 60-day toll-free period has drawn opposition from Hapag-Lloyd and wider industry concerns about an international precedent.

Lululemon apologised after a yoga and wellness festival on China’s Great Wall appeared to use a Japanese taiko drum during a performance advertised as celebrating Chinese culture. The incident, involving actor Zhu Yilong and the Hiiko drum troupe, triggered widespread criticism on Weibo, where related discussions surpassed 50 million views. Lululemon attributed the mistake to inadequate cultural expertise, removed event content and promised stricter review procedures. The controversy illustrates the risks Western brands face when marketing in China and follows similar disputes involving Arc’teryx and Dolce & Gabbana.

UK consumer price inflation remained unexpectedly steady at 2.8% in May, confounding forecasts of a rise to 3%. Higher transport costs, including air fares, petrol and vehicle taxes, were offset by slower food-price inflation and lower domestic heating-oil costs. Core inflation nevertheless rose to 2.6%, while transport inflation accelerated to 6.8%. The benign data pushed 10-year government bond yields lower and strengthened expectations that the Bank of England would leave interest rates at 3.75%. Economists warned that higher costs faced by farmers, manufacturers and supply chains could still feed through to food prices, while a US-Iran agreement and falling oil prices could moderate the impact of the regional conflict.

Investment fund Rebalance Earth is financing the expansion of rewilding at the 1,100-hectare Broughton Sanctuary estate in North Yorkshire. The project will restore woodlands, wetlands, grasslands and meadows, replace spruce with native vegetation, introduce grazing animals, and improve the land’s ability to retain water. The estate has already planted 330,000 trees and seen the return of otters, curlews and beavers. Rebalance Earth expects the restoration to produce environmental and social benefits while generating revenue through biodiversity net-gain units, nature credits and carbon credits. The scheme reflects growing interest from pension funds and businesses in natural-capital investments as climate-related flooding, drought and erosion risks increase.

Donald Trump claims the US has secretly helped 200 tankers carry more than 100m barrels of oil through Iran’s blockade of the Strait of Hormuz, but the scale of the operation remains difficult to verify. Maritime intelligence indicates that US overwatch operations may be assisting nighttime “dark” tanker transits, followed by ship-to-ship transfers in the Gulf of Oman. Estimates suggest roughly 1.9m to 2.9m barrels of oil a day may be moving through these channels—well below the prewar level of 15.6m barrels a day but more than previously believed. Continued clandestine shipments, pipeline diversions by Saudi Arabia and the UAE, and weaker Chinese imports have helped ease prices temporarily, though analysts expect prices to rise again if normal flows do not resume.

A Worldpanel by Numerator survey of more than 11,600 households found that GLP-1 use in Great Britain has nearly tripled over two years, with more than 6.3% of households now including a user. Households with a user spent an estimated £780m less on groceries, equivalent to £418 less per household, as people bought fewer items and reduced consumption of treats such as chocolate and crisps. Users also reported fewer cravings, demand for smaller restaurant portions and interest in GLP-1-friendly menus, while increased purchases of mouthwash and chewing gum reflected side effects. Retailers including Marks & Spencer and Ocado are beginning to adapt their products and services, although medication cost remains a major barrier.

Former Burberry creative chief and CEO Christopher Bailey, together with private investors, has acquired Burleigh Pottery after its parent company Denby entered administration. The investment is intended to preserve production at the Middleport Pottery site, protect all 62 jobs and maintain Burleigh’s traditional tissue-transfer manufacturing technique. The deal comes amid soaring energy and labour costs, cheaper international competition and wider pressures on Britain’s ceramics industry; a £120m government support package arrived too late to save Denby and other manufacturers.

UK employers are increasingly choosing temporary workers over permanent staff as economic uncertainty, higher business costs, political turbulence and conflict in the Middle East weaken confidence. A KPMG and Recruitment and Employment Confederation survey of 400 recruitment consultancies found a strong rise in temporary vacancies in May alongside the fastest decline in permanent recruitment for 10 months. Candidate numbers increased amid redundancies and reduced opportunities, while salary growth remained modest. Demand for permanent staff rose only in nursing, medical and care services and fell most sharply in retail. The UK unemployment rate reached 5% in the three months to March, while business leaders warned that the decline in entry-level roles is worsening youth unemployment.