IMF: Mideast War Causes Unprecedented Economic Shock in Gulf Region
The International Monetary Fund (IMF) has declared the ongoing Middle East war an unprecedented economic shock for the region, warning that a quick recovery is not guaranteed. According to a recent regional report, five of the eight Gulf oil- and gas-producing nations are projected to face economic contraction this year. While Saudi Arabia, the United Arab Emirates, and Oman are expected to maintain positive growth, their rates will significantly slow. The conflict, marked by Iranian attacks on energy infrastructure and the closure of the Strait of Hormuz, has slashed Gulf energy production by over 10 million barrels of oil daily. Consequently, growth forecasts for Gulf Cooperation Council monarchies have been halved to 2.0 percent. Qatar is particularly affected, with its growth prediction revised downward by nearly 14 percentage points to an 8.6 percent contraction. IMF official Jihad Azour noted that rebound predictions for 2027 depend heavily on a rapid conflict resolution. The crisis also threatens to worsen humanitarian conditions in poorer nations like Sudan and Yemen and impact heavily indebted countries such as Egypt through inflation and reduced remittances.
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IMF: Mideast War Causes Unprecedented Economic Shock in Gulf Region
The International Monetary Fund (IMF) has declared the ongoing Middle East war an unprecedented economic shock for the region, warning that a quick recovery is not guaranteed. According to a recent regional report, five of the eight Gulf oil- and gas-producing nations are projected to face economic contraction this year. While Saudi Arabia, the United Arab Emirates, and Oman are expected to maintain positive growth, their rates will significantly slow. The conflict, marked by Iranian attacks on energy infrastructure and the closure of the Strait of Hormuz, has slashed Gulf energy production by over 10 million barrels of oil daily. Consequently, growth forecasts for Gulf Cooperation Council monarchies have been halved to 2.0 percent. Qatar is particularly affected, with its growth prediction revised downward by nearly 14 percentage points to an 8.6 percent contraction. IMF official Jihad Azour noted that rebound predictions for 2027 depend heavily on a rapid conflict resolution. The crisis also threatens to worsen humanitarian conditions in poorer nations like Sudan and Yemen and impact heavily indebted countries such as Egypt through inflation and reduced remittances.
AL-MONITOR: The Pulse of The Middle East