International Organizations: Continued Blockade of Strait of Hormuz Could Trigger Global Fuel Crisis

The heads of the International Monetary Fund (IMF), the World Bank, and the International Energy Agency (IEA) warned today that if oil transport through the Strait of Hormuz does not return to normal, the world could face a risk of fuel shortages during the summer peak demand season. According to AFP, the heads of the three institutions issued a joint statement stating, "Global oil stocks are being consumed at a record pace due to significant disruptions in supply through the Strait of Hormuz." "If transport does not return to normal, global oil stocks will continue to be depleted rapidly before the summer peak in oil demand in the Northern Hemisphere. This poses an increasing risk to fuel security, market conditions, and broader economic resilience." The war between the US and Israel against Iran has plunged the Middle East into conflict, with Tehran's retaliatory actions often targeting Washington's regional allies while effectively blockading a critical waterway that accounts for one-fifth of global energy supplies. In April this year, the leaders of the IMF, World Bank, and IEA announced the formation of a coordination group to manage crisis response measures, particularly to assist vulnerable economies. In today's joint statement, they reiterated that the war has pushed up energy and fertilizer prices, causing particularly severe impacts on low-income countries. The statement noted, "Many countries are entering the planting season, and rising fertilizer prices are very concerning." During the spring meetings, IMF Managing Director Kristalina Georgieva stated that the Middle East war had forced the IMF to downgrade its global economic growth forecasts. She estimated that vulnerable economies would need $20 billion to $50 billion in financial assistance to cope with the impact of the Middle East conflict. This week, the IMF announced that Bangladesh has officially applied for a series of financial assistance programs, and both sides are negotiating to prepare for the implementation of relevant plans.