IMF: Middle East war damage will outlast any peace deal
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The International Monetary Fund warns that the Middle East war has triggered a major global supply shock, disrupting energy flows and causing lasting damage to growth, trade, and inflation. Even with a peace deal, the IMF expects the negative effects to persist, with slower growth and a heavier burden on vulnerable oil-importing nations.
The Middle East war has delivered a fresh global supply shock. The conflict has disrupted energy flows, raising prices and causing lasting damage to growth, trade, and inflation. Significant damage to critical energy infrastructure may take three to five years to fully repair. The IMF has downgraded its forecast for the world economy, indicating the negative effects will persist even with a peace deal. The war has cut world daily oil flows by around 13% and LNG flows by about 20%. Prices have eased but remain above pre-war levels. The IMF expects slower growth and a heavier burden on vulnerable oil-importing nations.
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