Guardian Warns of Global Inflation Risk Following Potential Iran Aggression
According to the International Desk of Webangah News Agency, the Guardian has warned about the repercussions of aggression by the United States and the Israeli regime against Iran. The publication noted that an increase in oil and gas prices following such an attack could generate a fresh wave of global inflation, posing a serious risk to the fragile process of global economic recovery this year.
The media outlet added that heightened tensions in West Asia have led to a jump in oil and gas prices, which in turn could impose new inflationary pressure on the global economy. Economists and global bankers have cautioned that if the conflict prolongs, the prices of goods and services worldwide will rise, potentially altering economic growth forecasts entirely.
Kristalina Georgieva, the Managing Director of the International Monetary Fund, stated that if energy prices increase by approximately 10 percent for a year, global inflation would rise by about 0.4 percentage points, and global economic growth would decline by 0.1 to 0.2 percent. She added that the global economy, despite numerous shocks, remains somewhat resilient, with its growth currently estimated at around 3.3 percent.
Meanwhile, Lord Jim O’Neill, former chief economist at Goldman Sachs Asset Management and a former advisor to the UK government, warned that the White House appears to be paying little attention to the geopolitical consequences of recent developments and subsequent bombings. According to him, countries bordering the Persian Gulf may perceive the United States as an unreliable partner and gravitate towards powers such as China, India, and Brazil.
The report also highlighted the critical role of the Strait of Hormuz in the energy market. This strategic waterway accounts for approximately 20 percent of global oil supply. Estimates from Bloomberg Economics indicate that a one percent reduction in oil supply could increase prices by about four percent. Consequently, if oil transit through the Strait of Hormuz is disrupted for several months, oil prices could rise by as much as 80 percent from pre-war levels, reaching around $108 per barrel.
Furthermore, Oxford Economics forecasts that in such a scenario, inflation rates in the UK and the Eurozone would be 0.5 to 0.6 percentage points higher than previous estimates by the end of the year. The Guardian continues by stating that the current increase in oil prices is already exerting direct pressure on consumers. Following a 17 percent rise in Brent crude oil prices, gasoline prices in the United States have also increased. Data from a gas price tracking service shows that the average price of gasoline at U.S. fueling stations has risen by approximately 15 cents per gallon in recent days.
The report warns that if the conflict persists and global supply chains are disrupted, living costs in many countries will increase, intensifying economic pressure on households and governments.
