Several international financial and energy institutions have warned that prolonged disruption to shipping through the Strait of Hormuz could trigger fuel shortages during the Northern Hemisphere summer, as global energy inventories continue to decline.
In a joint statement, the International Monetary Fund, International Energy Agency, and World Bank said global oil stockpiles are being depleted at a record pace due to substantial supply losses normally transported through the Strait of Hormuz.
Moreover, the institutions warned that continued inventory drawdowns could increase risks to fuel security, market stability, and broader economic resilience if shipping flows are not restored before peak summer demand.
The statement also highlighted the disproportionate impact of rising energy and fertiliser costs on lower-income economies. Additionally, officials noted that elevated fertiliser prices pose a particular challenge as many countries enter key planting seasons, potentially affecting agricultural production and food security.
Vulnerable Economies Face Rising Pressure
Iran has restricted shipping through the Strait of Hormuz, a strategic maritime route that typically handles around one-fifth of global oil and liquefied natural gas supplies, following US-Israeli military operations launched in late February.
Consequently, disruptions to energy flows have intensified concerns over supply security and inflationary pressures across global markets.
In April, the IMF, World Bank, and IEA established a joint coordination group to support vulnerable economies affected by the crisis and to strengthen policy responses to the evolving situation.
Growth Outlook Remains Under Pressure
At the IMF Spring Meetings earlier this year, Kristalina Georgieva said the conflict had already weighed on the global economic outlook, contributing to a downgrade in growth projections.
Furthermore, Georgieva estimated that vulnerable economies may require between $20 billion and $50 billion in financial assistance to address the economic consequences of the conflict, including higher energy costs, inflationary pressures, and supply chain disruptions.
As a result, policymakers and international institutions continue to closely monitor developments, with the pace of recovery in maritime traffic through the Strait of Hormuz likely to remain a key factor shaping global energy markets and economic stability in the months ahead.
