IMF cuts global growth outlook

The International Monetary Fund cut its growth outlook on Tuesday due to Iran war-driven energy price spikes and supply disruptions and warned that the global economy would teeter on the brink of recession if the conflict worsens and oil stays above USD100 per barrel through 2027. With massive uncertainty over the Middle East conflict gripping finance officials gathering for IMF and World Bank spring meetings in Washington, the IMF presented three growth scenarios: weaker, worse and severe, depending on how the war unfolds. The World Economic Outlook’s most optimistic “reference scenario” assumes a short-lived Iran war and forecasts 3.1 percent real GDP growth for 2026, down 0.2 percentage point from its previous forecast in January. Under this scenario, oil prices average USD82 per barrel for all of 2026, a decline from recent levels of around USD100 for the Brent benchmark futures price.