The global economy is facing a new risk.
The International Monetary Fund (IMF) has warned that the ongoing conflict in the Middle East could place fresh pressure on global inflation, with rising energy prices emerging as a key concern for policymakers.
Speaking at a symposium hosted by Japan’s Ministry of Finance, IMF Managing Director Kristalina Georgieva said the conflict is testing the resilience of the global economy once again.
Energy markets, she noted, remain particularly vulnerable.
According to Georgieva, a 10 percent increase in global oil prices, if sustained through most of the year, could push global inflation up by around 40 basis points.
Such a shift could add further pressure on economies that are already navigating tight financial conditions and slower growth.
“We are seeing resilience tested again by the new conflict in the Middle East,” Georgieva said during the discussion.
The warning highlights how geopolitical tensions can quickly spread beyond regional borders and influence global economic stability.
Higher oil prices often lead to rising transport costs, increased production expenses, and broader price pressures across many sectors of the economy.
As a result, central banks and governments around the world are closely monitoring developments in energy markets.
Georgieva urged policymakers to prepare for potential shocks in an increasingly uncertain global environment.
“My advice to policymakers in this new global environment is to think of the unthinkable and prepare for it,” she said.
The message reflects growing concerns that geopolitical tensions could once again disrupt energy supply chains and drive inflation higher.
For global markets, the direction of oil prices in the coming months may therefore play a crucial role in shaping the outlook for global inflation and economic stability.
Last modified: March 10, 2026
