WASHINGTON (AN) — Restrained global oil supply resulting from the war in Iran and blockage of the Strait of Hormuz has led to extreme volatility in energy markets that will likely stall global economic growth for the rest of the year, according to the International Monetary Fund's latest projections.
IMF's World Economic Outlook released on Tuesday estimates that growth in world output will decelerate to 3.1% in 2026, down from 3.4% last year, representing a downward revision of IMF's original projection of 3.3% for 2026 at the beginning of the year. However, given the conflict's uncertain trajectory, the IMF modeled three distinct scenarios, ranging from a short-lived disruption to a prolonged crisis, each projecting different inflation and growth outcomes based on the severity of the economic fallout.
