UK stocks have dropped sharply following the Iran-Iraq conflict, with oil prices rising by almost 8% and a surge in demand for shipping in the Strait of Hormuz. British oil companies rose by 2%, while other equity sectors saw increased selling pressure. British government bond yields also rose as investors reduced expectations for Bank of England interest rate cuts. Meanwhile, British Airways (IAA) dropped 5.8% after announcing it had cancelled flights to Tel Aviv and Bahrain.