Global Agencies Warn US-Iran Conflict Hits Vulnerable Nations Hardest

Leaders of the World Bank, International Monetary Fund (IMF), World Trade Organisation (WTO), and the International Energy Agency (IEA) gathered in Washington D.C. last weekend. They met to evaluate the economic fallout from the Middle East conflict. The group warned that the war is causing severe, uneven shocks to energy supplies, food security, and economic activity worldwide.

The agencies observed that while the global economy remains resilient, the conflict’s impact is disproportionately hurting the most vulnerable nations. These countries face rising fuel and fertilizer costs, heightened uncertainty, and threats to jobs and livelihoods.

A joint statement was signed by World Bank President Ajay Banga, IMF Managing Director Kristalina Georgieva, WTO Director General Dr. Ngozi Okonjo-Iweala, and IEA Executive Director Dr. Fatih Birol. They said they are monitoring government measures to tackle the conflict’s economic impact. Their goal is to promote transparency, share lessons, and spot emerging risks.

The statement read, “The war in the Middle East is generating substantial and highly asymmetric impacts on energy supplies, food security, and economic activity across countries and regions.”

It added, “While the global economy continues to show resilience, the effects of the conflict are disproportionately affecting the most vulnerable countries through higher fuel and fertiliser prices, increased uncertainty, and risks to jobs and livelihoods.”

The document highlighted that higher fertilizer prices are a major concern as many nations enter their planting season. At the same time, global oil inventories are being drawn down at a record pace. This is due to the major loss of supply through the Strait of Hormuz.

The agencies warned that if shipping flows do not return to normal, continued rapid depletion of global oil inventories ahead of peak summer oil demand in the Northern Hemisphere would present increasing risks. These risks include fuel security, market conditions, and broader economic resilience.

“We met to take stock of the impacts, discuss the situation in the most affected countries and regions, and coordinate our support to those in need,” the statement said. “We also explored options further to enhance collective support through multilateral and bilateral actions.”

Heads of the multilateral agencies emphasized the importance of closely monitoring fertilizer supply chains, energy developments, and policy responses. They said they are tracking and analyzing measures taken by governments to address the economic impact of the conflict. This is with a view to promoting transparency, sharing lessons, and identifying emerging risks.

“We will remain in close contact as the situation evolves and continue coordinating our efforts to support the countries most affected and global economic stability,” the statement concluded.