Fuel and fertiliser prices may remain elevated for a prolonged period as disruptions to shipping through the Strait of Hormuz and damage to infrastructure continue to delay recovery in global supplies, the International Energy Agency (IEA), International Monetary Fund (IMF) and World Bank Group said.
In a joint statement issued after a coordination meeting ahead of key global reports, the three institutions flagged persistent risks to energy and food markets amid ongoing uncertainty in the Middle East.
“The situation remains very uncertain, and shipping through the Strait of Hormuz is yet to normalize,” the statement said, underlining continued stress on a key global energy transit route.
Supply recovery may not stabalise
The agencies warned that even if flows stabilise, supply recovery will not be immediate. “Even after a resumption of regular shipping flows through the Strait, it will take time for global supplies of key commodities to move back towards their pre-conflict levels—and fuel and fertilizer prices may remain high for a prolonged period given the damage to infrastructure,” they said.
The disruption has already pushed up oil, gas and fertiliser prices, with wider economic implications. “The shock has led to higher oil, gas and fertilizer prices, triggering concerns about food security and job losses as well,” the statement said.
The impact is uneven across economies, with energy importers bearing the brunt. “The impact of the war is substantial, global, and highly asymmetric, disproportionately affecting energy importers, in particular low-income countries,” the institutions said.
Supply disruptions are also affecting production chains beyond energy. “Due to supply disruptions, shortages of key inputs are likely to have implications for energy, food, and other industries,” the statement said.
The conflict has also affected economic activity, with displacement of populations and disruption to services sectors. “The war has also forcibly displaced people, impacted jobs, and reduced travel and tourism, which may take time to reverse,” it added.
At the same time, producers in the region are also facing setbacks. “Some oil and gas producers in the Middle East have also seen a dramatic loss of export revenue,” the statement noted.
The heads of the three institutions met to review the evolving situation ahead of the release of the IEA’s monthly Oil Market Report and the IMF’s World Economic Outlook, and to coordinate policy responses.
“Our teams are working closely… to help countries through tailored policy advice and… financial support where needed,” they said, adding that they will continue to monitor the impact on energy markets and the global economy.