International Organizations Warn of Negative Impacts from Middle East Conflicts

On May 30, the International Energy Agency, International Monetary Fund, World Bank, and World Trade Organization issued a joint statement warning that conflicts in the Middle East are causing substantial and highly asymmetric impacts on global energy supply, food security, and economic activity. The statement noted that while the global economy still shows resilience, the rise in fuel and fertilizer prices, increased uncertainty, and livelihood risks due to the Middle East conflicts are hitting the most vulnerable countries harder. With some countries entering the planting season, the rise in fertilizer prices is particularly concerning. The statement emphasized the importance of closely monitoring fertilizer supply chains, energy and economic conditions, as well as policy responses. It also indicated that due to shipping disruptions in the Strait of Hormuz, global oil inventories are declining at a record pace. If shipping does not return to normal, global oil stocks will continue to decrease rapidly before the peak summer demand in the Northern Hemisphere, posing increasing risks to fuel security, market conditions, and economic resilience.