Oil could top $100, IMF warns as Middle East war triggers energy shock

The International Monetary Fund said on April 14 that the Middle East war had “halted” the world economy’s momentum and turned oil back into the central risk. (imf.org) The Fund cut its 2026 global growth forecast to 3.1% in its World Economic Outlook, down from 3.4% in January. IMF chief economist Pierre-Olivier Gourinchas said the closure of the Strait of Hormuz and damage to energy facilities had raised the prospect of a major energy crisis. (imf.org 1) (imf.org 2) In the IMF’s regional update, Brent crude was already above $100 a barrel after the war that began on February 28, 2026. The Fund said the shock quickly spread beyond the region into gas, fertilizer and metals prices, tightening supply chains worldwide. (imf.org) The IMF laid out three paths from here: a reference case, an adverse case and a severe case. In the adverse case, oil averages about $110 a barrel in 2026, global growth falls to 2.6%, and global inflation rises to 5.4%. (imf.org 1) (imf.org 2) Kristalina Georgieva had previewed the scale of the hit before the meetings opened. On April 9, she said the world’s daily oil flow had been cut by about 13% and liquefied natural gas flows by about 20%, with Brent jumping from $72 before hostilities to a peak of $120. (imf.org) That matters most for countries that import fuel and already have thin fiscal buffers. The IMF said that, on average, every 10% rise in crude trims growth by about 0.5 percentage point and lifts inflation by a full percentage point in affected Middle East and North Africa economies. (imf.org) The pressure was not just theoretical in Washington. Reuters reported on April 15 that Georgieva said 12 or more countries were already approaching the IMF for financing to cope with the war-driven energy shock. (usnews.com) Finance ministers also used the meetings to push for a durable ceasefire. Reuters reported that ministers from nearly a dozen countries, led by Britain, said the conflict would keep weighing on growth and markets even if it ended soon. (msn.com) Oil markets kept underlining the risk after the meetings began. CNBC reported on April 22 that Brent rose back above $100 after Iran’s Revolutionary Guard said it had seized two container ships trying to cross the Strait of Hormuz. (cnbc.com) The IMF’s baseline still assumes disruptions begin to fade by mid-2026 and oil averages about $82 this year. Its warning was narrower and sharper: if the war lasts and oil stays near or above $100, the fight against inflation becomes a live problem again. (imf.org)