NEW DELHI: The International Monetary Fund said that energy and commodity prices have eased since the US-Iran agreement to halt hostilities and reopen the Strait of Hormuz, but warned that it will take time for prices and Gulf trade flows to fully normalise due to shipping lead times.
IMF spokesperson Julie Kozack told a news briefing the Fund will decide in its July 8 World Economic Outlook update whether to retain the three growth scenarios outlined in April that depended on the conflict’s trajectory.
With the Strait of Hormuz closed in May and benchmark oil above $100 a barrel, the IMF had indicated the global economy was shifting from its benign reference case to an adverse scenario, implying 2.5 per cent global growth for 2026, alongside tighter financial conditions and rising inflation expectations.
India growth remains strong
Kozack said that inflation expectations remain well anchored as some central banks lifted rates, and that financial conditions are still accommodative, with both advanced and emerging markets accessing international financing.
Brent crude futures for August delivery traded around $73 a barrel on Thursday, their lowest since before the Feb. 28 start of the US-backed war with Iran.
Prices for urea, other fertilizers and base metals have also fallen as Gulf shipments resume, but she cautioned a full return to normal will depend on the ceasefire holding.
The IMF said it is most concerned about the conflict’s impact on developing, net energy-importing countries with limited fiscal buffers or commodity stockpiles, particularly in Africa.
On India, Kozack said domestic demand remains strong, with real GDP growth projected at 6.5 per cent for fiscal 2026–2027.
