Greg Goebel
The adverse effect of the conflict on the world economy was smaller than anticipated at the end of February, mainly because energy prices did not increase as significantly as many economists predicted.
This occurred because of factors that reduced impact, including higher output from other oil producers and the decrease in reserves, along with the capacity of companies and households to promptly shift to alternative sources.
Nonetheless, the IMF cautions that these mitigating factors have boundaries that will be challenged by an extended closure of the Strait.
The Fund estimates that from early March to late May, the closing of the Strait led to a decrease in oil supplies to markets exceeding 1.1 billion barrels, which corresponds to roughly 10 days of worldwide consumption.
IMF Strategy Director Christian Mumssen states that the factors balancing each other and averting a more significant adverse effect of the war on economic growth will continue; however, extended interruptions in energy supplies will certainly influence the forecast.
He remarked that predicting the Fund's expectation for global GDP growth in October (the next planned release date of the IMF report) is quite challenging.
source: imf.org
This occurred because of factors that reduced impact, including higher output from other oil producers and the decrease in reserves, along with the capacity of companies and households to promptly shift to alternative sources.
Nonetheless, the IMF cautions that these mitigating factors have boundaries that will be challenged by an extended closure of the Strait.
The Fund estimates that from early March to late May, the closing of the Strait led to a decrease in oil supplies to markets exceeding 1.1 billion barrels, which corresponds to roughly 10 days of worldwide consumption.
IMF Strategy Director Christian Mumssen states that the factors balancing each other and averting a more significant adverse effect of the war on economic growth will continue; however, extended interruptions in energy supplies will certainly influence the forecast.
He remarked that predicting the Fund's expectation for global GDP growth in October (the next planned release date of the IMF report) is quite challenging.
source: imf.org