Economic consequences of the Middle East conflict will linger beyond any truce

Each month Oxford Economics’ team of 450 economists and analysts updates our baseline forecast for 200+ countries using our innovative Global Economic Model. Fully linking individual country models through global assumptions about trade volume and prices, competitiveness, capital flows, interest and exchange rates, and commodity prices, our model provides a rigorous and consistent structure for forecasting and understanding the impact of economic shocks.

Below is just the top-level summary of our analysis of the latest economic developments.

• We’ve lowered our world GDP growth forecast by 0.4ppts since the start of March to 2.4% because we expect a more prolonged disruption to shipping activity through the Strait of Hormuz.
• The fragile ceasefire seemingly reduces the risk of a far worse outcome. But even if a truce is maintained, it will take time for energy production and shipping traffic to return to normal levels.
• We assume that the Strait of Hormuz will remain effectively closed until the end of April.

To find out more complete the form.