Global trade is slowing
The WTO now expects world merchandise trade to expand just 1.9% in 2026 — a sharp slowdown tied to Middle East disruption. That matters because shipping chokepoints and higher energy costs have already pushed Brent above $126 and European gas up ~35%, risks the WTO says could further squeeze supply chains and inflation ( )
The WTO’s update flags services as a relative bright spot, forecasting commercial‑services exports to rise about 4.8% in 2026. (bloomberg.com) WTO economists calculate that sustained high oil prices could shave roughly 0.5 percentage points off merchandise trade growth. The report outlines a downside scenario in which goods‑trade expansion falls to roughly 1.4% if Gulf disruptions and energy shocks persist. (businessworld.in) Last year’s unusually strong trade performance—merchandise volumes rose about 4.6% in 2025—was driven in part by a surge in AI‑related goods and by firms front‑loading shipments ahead of U.S. tariff deadlines. (money.usnews.com) Maritime chokepoints are central to the risk: UNCTAD notes the Strait of Hormuz handles around one quarter of global seaborne oil trade, while analysts warn roughly one‑third of seaborne fertilizer flows also traverse the route. (unctad.org) Damage and shutdowns at Qatar’s Ras Laffan industrial city have removed about one‑fifth of global LNG export capacity, tightening gas markets and shortening spare capacity buffers. (bloomberg.com) Energy benchmarks and trade routes have already moved: the U.S. EIA recorded Brent crude rising from about $71 per barrel on Feb. 27 to roughly $94 by March 9 after the onset of military action, a shift the agency tied directly to Strait‑of‑Hormuz disruptions. (eia.gov) U.N. reporting and regional analysts say those energy and shipping shocks are hitting Asia‑Pacific economies first, with vulnerable importers seeing immediate pressure on fuel, fertiliser supply and trade costs. (news.un.org)
