economy

April 18, 2026

IMF Warns: Closing the Strait of Hormuz Could Lead to a Major Global Energy Crisis

Global disruption in the energy sector caused by the US-Israel war with Iran could help accelerate the global transition to renewable energy sources in the long run, offering potential growth amid a wider energy shock, said Deniz Igan, Chief of the World Economic Studies Division of the Research Department of the International Monetary Fund (IMF).

IMF Warns: Closing the Strait of Hormuz Could Lead to a Major Global Energy Crisis

TL;DR

  • A war between the US, Israel, and Iran could cause a global energy crisis due to potential disruption of the Strait of Hormuz.
  • The IMF views this situation as an opportunity to accelerate the transition to renewable energy for long-term growth and energy security.
  • Instead of general subsidies, the IMF recommends investing in policies that support the energy transition.
  • The conflict impacts the global economy through commodity prices, inflation expectations, and financial conditions.
  • Developing countries are more vulnerable to these economic shifts.
  • The IMF's economic forecasts are challenged by the volatility of oil and gas markets.

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