IMF, World Bank, IEA Unite to Tackle Global Energy Shock from Middle East War

The heads of the International Monetary Fund, World Bank Group, and International Energy Agency have agreed to establish a joint coordination group to address the far-reaching energy and economic disruptions triggered by the ongoing war in the Middle East.

In a joint statement, the three institutions said the conflict has caused “major disruptions to lives and livelihoods” and sparked one of the largest supply shortages in global energy market history, with consequences already rippling across economies worldwide.

They warned that the crisis is having a “substantial, global, and highly asymmetric” impact, hitting energy-importing nations, particularly low-income countries, the hardest. According to the statement, the shock is being transmitted through rising oil, gas and fertilizer prices, while also fueling concerns over escalating food costs.

The institutions further noted that global supply chains have been disrupted, affecting commodities such as helium, phosphate and aluminum, while tourism has also taken a hit due to flight disruptions at major Gulf transport hubs.

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They added that the situation has heightened market volatility, weakened currencies in emerging markets and raised inflation concerns, developments that could lead to tighter monetary policies and slower global growth.

“At these times of high uncertainty, it is paramount that our institutions join forces to monitor developments, align analysis, and coordinate support to policymakers to navigate this crisis,” the statement said.

The new coordination group will focus on assessing the scale of the crisis across countries and regions through shared data on energy markets, trade flows, inflation trends and supply chain disruptions.

It will also work to coordinate response measures, including “targeted policy advice, assessment of potential financing needs and related provision of financial support (including through concessional financing), and use of risk mitigation tools as appropriate.”

In addition, the group will engage with multilateral, regional and bilateral partners to ensure an effective and unified response to countries most affected by the crisis.

The organisations stressed that the initiative will prioritise support for nations facing limited fiscal space and rising debt burdens, while drawing on expertise from other international bodies where necessary.

“We are committed to working together to safeguard global economic and financial stability, strengthen energy security, and support affected countries and people on their path to sustained recovery, growth, and job creation through reforms,” the statement added.