IMF Warns Iran War Could Lead to Recession — Even with Quick End
The fund said a quick end to the conflict could still leave governments facing high energy prices and shortages.
- IMF chief economist Pierre-Olivier Gourinchas warned Tuesday that the world faces an oil shortfall this year, even if the Strait of Hormuz reopens immediately. The International Monetary Fund forecast global growth of 3.1% in 2026, a 0.2 percentage point downgrade.
- Iran has effectively closed the Strait, halting nearly one-fifth of global crude supply and triggering the largest disruption in history. The International Energy Agency reported that global oil supply plummeted by 10.1 million barrels a day in March.
- Oil prices have surged past $100 a barrel, affecting heating, electricity, and manufacturing costs worldwide. The IMF warned that governments should resist overspending to shield consumers from high energy prices, noting that public finances were "already strained" before the war.
- On Wednesday, Australian Finance Minister Jim Chalmers warned that the global economy faces a "really dangerous time" due to the conflict. Traveling to Washington for G20 meetings, Chalmers stated the war's consequences would be felt "for some time."
- Under a worst-case scenario where energy prices spike 100-200% and persist into 2027, global economic growth would drop to around 2 percent. The IMF warns this could push the world toward a recession, defined as growth below 2%.
14 Articles
14 Articles
By Hanna Ziady and Stephanie Yang, CNN. The International Monetary Fund (IMF) says the world will face an oil shortage this year—even if the war with Iran were resolved this week—joining other major economic bodies in warning of the serious, likely, and potential impacts of the conflict. “If everything stopped tonight and, starting tomorrow, we moved toward reopening the Strait (of Hormuz)… we would still face an oil deficit this year,” Pierre-O…
The war in Iran, after the trade war, has resurfaced global inflationary pressures. Political, geopolitical and energy uncertainty is pressing everyone...
Iran war escalation could push global economy to brink of recession, IMF warns
The International Monetary Fund (IMF) warned that a further escalation in the war on Iran and continued disruption to oil markets could push the global economy to the brink of recession, with growth potentially slowing to 2% under its worst-case scenario. MORE..
IMF sees global oil shortfall this year and warns Iran war could tip world into recession
By Hanna Ziady, Stephanie Yang, CNN London/Hong Kong (CNN) — The International Monetary Fund says the world will suffer an oil shortfall this year – even if the war with Iran were resolved this week – becoming the latest major economic body to warn of severe likely and potential impacts of the conflict. “If everything
Due to the war in the Middle East, global economic growth is stalling, we are facing higher inflation, and the risk of a recession is becoming significantly greater. The International Monetary Fund (IMF) warns of this in a new report.
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