IMF Reveals Middle East War Causes Oil Supply to Plummet

IMF Managing Director Kristalina Georgieva has stated that the conflict in the Middle East has caused major difficulties worldwide. “The resilient global economy is being tested again by the war currently ravaging the Middle East,” she said, referring to the ceasefire achieved between the US and Iran, as quoted from Antara. One of the main negative impacts of the war is the shock to global crude oil supplies. Currently, Georgieva said, oil distribution has fallen by up to 13 per cent and liquefied natural gas (LNG) by 20 per cent per day. At the same time, she estimated that the supply disruptions would cause refinery closures as well as fuel and food crises. “As a warning, because this is a negative supply shock, demand adjustment is unavoidable,” Georgieva stated. Previously, on Tuesday, US President Donald Trump announced a two-week ceasefire agreement with Iran. This was responded to by Iranian Foreign Minister Abbas Araghchi, who stated that the Strait of Hormuz—through which around 20 per cent of global oil supplies, petroleum products, and LNG pass—would be reopened as part of the ceasefire agreement. The ceasefire represents a positive development following the latest conflict in the Middle East, which was triggered by joint US and Israeli attacks on Iran on 28 February 2026. In retaliation, Iran then attacked Israeli territory and several US military facilities in the Middle East, as well as restricting traffic in the Strait of Hormuz—which triggered supply disruptions and a surge in global energy prices.