The war on Iran is disrupting energy supplies, fuelling inflation and raising the risk of a global downturn, with the poorest countries set to suffer most.

The International Monetary Fund warned Tuesday that the US-Israeli war on Iran could slow global economic growth, stoke inflation, and increase the possibility of a worldwide recession and energy crisis.

The illegal war of choice on Iran being waged by US President Donald Trump and the government of  fugitive Israeli Prime Minister Benjamin Netanyahu has already had wide-ranging negative impacts on the global economy, from soaring fuel prices caused by the closure of the Strait of Hormuz to supply chain disruptions and financial market volatility.

However, a major global economic crisis has thus far been averted. That could soon change.

“Despite major trade disruptions and policy uncertainty, last year ended on an upbeat note,” International Monetary Fund director of research Pierre-Olivier Gourinchas wrote in an  analysis of the IMF’s latest  _World Economic Outlook_ report.

“The private sector adapted to a changing business environment, while powerful offsets came from lower US tariffs than originally announced, some fiscal support, and favorable financial conditions coupled with strong productivity gains and a tech boom.”

“Despite some downside risks, the momentum was expected to carry over into 2026, lifting the pre-conflict global growth forecast to 3.4 per cent,” Gourinchas continued. “War in the Middle East has halted this momentum. The closing of the Strait of Hormuz and serious damage to critical facilities in a region central to global hydrocarbon supply raise the prospect of a major energy crisis should hostilities continue.”

The IMF said that even if the war ends quickly, lasting damage to the world’s economy will still........

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