Iran war could trigger an unprecedented energy shock: IMF

The International Monetary Fund (IMF) has warned that the ongoing US-Israel conflict with Iran could trigger an “unprecedented energy shock,” raising the risk of a global recession.

In a report released Tuesday, the IMF said escalating tensions in the Middle East are already weighing on global growth forecasts and pushing economic risks higher.

The Fund warned that prolonged disruption in energy markets could hit growth and drive inflation across major economies, with energy-importing and developing countries expected to be the worst affected.

It also noted that G7 economies could face slower growth, with the United Kingdom likely to be among the most impacted.

IMF Chief Economist Pierre-Olivier Gourinchas cautioned that continued escalation and potential disruption of key oil routes could significantly increase global oil prices, further weakening the global economic outlook.