عربي English Türkçe اردو فارسى
Logo
Latest News
Business

OECD Outlook: Significant Risks to Global Economy if Hamas-Israel Conflict Expands

OECD expects inflation to gradually decline to 5.3 percent next year in its member countries (dpa)
OECD expects inflation to gradually decline to 5.3 percent next year in its member countries (dpa)
TT
TT

OECD Outlook: Significant Risks to Global Economy if Hamas-Israel Conflict Expands

OECD expects inflation to gradually decline to 5.3 percent next year in its member countries (dpa)
OECD expects inflation to gradually decline to 5.3 percent next year in its member countries (dpa)

The Organization for Economic Cooperation and Development (OECD) reduced its forecast for global GDP growth to 2.9 percent in 2023 while keeping next year's forecast unchanged.
It warned that the worsening conflict between Israel and Hamas in the Gaza Strip could undermine the economy.
According to the estimates of the Paris-based institution, "If the conflict escalates and spreads to the entire region, the risks of growth slowdown and increased inflation will be much greater than they are now."
The Organization noted that the war has had a relatively limited impact on the global economy, noting that international growth would slow to 2.7 percent in 2024 from an expected 2.9 percent pace this year.
OECD Chief Economist Clare Lombardelli explained in the report that the obstacles holding back the economy are not coming from the Middle East and that tight financial conditions, weak trade, and low confidence all have grave consequences.
"Global growth is set to remain modest, with the impact of the necessary monetary policy tightening, weak trade, and lower business and consumer confidence being increasingly felt."
Consumer price inflation is expected to gradually ease towards central bank targets in most economies to 5.3 percent next year, compared to 7.4 percent this year.
GDP growth in the US is projected at 2.4 percent in 2023 before slowing to 1.5 percent in 2024. In the euro area, GDP growth is projected to be 0.6 percent in 2023 before rising to 0.9 percent in 2024 and 1.5 percent in 2025.
Lombardelli stated that the "pace of growth is uneven."
China is expected to grow at a 5.2 percent rate this year before growth drops to 4.7 percent in 2024 and 4.2 percent in 2025 due to ongoing stresses in the real estate sector and continued high household saving rates.
The Organization pointed out that if the war in the Middle East intensifies and expands, the impact of its transition on the global economy may be mainly through oil and gas prices.
It indicated that a ten percent rise in the price of a gas barrel may lead to an increase in global inflation by 0.2 points in the first year and a decrease in growth by 0.1 points.
Trade may be significantly affected, especially since two international trade routes, the Strait of Hormuz and the Suez Canal, are within the conflict zone.

Most Viewed

 
 
Business

European Gasoline Heads to Asia as Iran War Sparks Supply Fears

Oil, gasoline, and diesel storage tanks in Carson, California (Reuters)
Oil, gasoline, and diesel storage tanks in Carson, California (Reuters)
TT
TT

European Gasoline Heads to Asia as Iran War Sparks Supply Fears

Oil, gasoline, and diesel storage tanks in Carson, California (Reuters)
Oil, gasoline, and diesel storage tanks in Carson, California (Reuters)

European and US gasoline cargoes are heading to the Asia Pacific after Asian prices surged on tightening supply due to the US-Israeli war with Iran, according to trade sources and shipping data.

The war has disrupted crude and oil product shipments from the Middle East to Asia, causing Asian refineries to cut output and forcing fuel distributors to seek supply from as far as the United States and buy more Russian fuel.

The extra shipping costs will exacerbate already soaring fuel prices for consumers and businesses, said Reuters.

At least three gasoline cargoes totaling about 1.6 million barrels have loaded last week from Europe for Asia, according to traders ‌and ship tracking data ‌from Kpler, as companies including Vitol and TotalEnergies ship the ‌fuel ⁠to the East ⁠to cash in on better margins in Asia.

Vitol and TotalEnergies declined to comment. Earlier, Exxon Mobil booked US gasoline cargoes for Australia.

Europe typically only sends small parcels of gasoline to the East of Suez markets, while its key markets are the US, Latin America and West Africa.

Asian refiners' profits from making a barrel of gasoline from Brent crude are hovering near 2022 highs of about $37 a barrel over Brent crude last week versus $8 before the ⁠war.

"One key factor is refinery behavior under crude supply uncertainty. ‌As disruptions around the Strait of Hormuz increase feedstock ‌risk, some refiners are becoming more cautious about run rates or export commitments," Nithin Prakash, analyst at ‌consultancy Rystad Energy, said.

Even if inventories currently appear comfortable, lower refining throughput could tighten ‌the supply outlook and support gasoline margins, he said. Singapore inventories of light distillates, which include gasoline and naphtha, are about 6% higher than the same time last year, at 17.93 million barrels, LSEG data showed.

REGIONAL SUPPLY FALLS

Gasoline supply from within the region is falling as shipments from ‌top fuel exporter South Korea are expected to drop to between 5 million and 6 million barrels in March from a three-month ⁠average of about ⁠10 million barrels, preliminary Kpler and LSEG data showed.

China, another big supplier, has banned fuel exports to shore up its domestic market. Thailand and Vietnam have also restricted fuel exports. Traders are now pinning their hopes on Asia's second largest fuel exporter, India, which typically sends about 40% of its monthly shipments of between 7 million and 8 million barrels to the Middle East, to pivot to the East.

India typically sends about 22% of its gasoline to Asia, LSEG data showed. However, the country's gasoline exports have plummeted to about 5 million to 6 million barrels in March from around 12 million barrels last month, preliminary LSEG and Kpler data showed, as state-run Mangalore Refinery and Petrochemicals has temporarily suspended cargo loadings.

Vessel Load port Discharge Volume Load Charterer port (bbl) date Maui Ventspils Singapore 770,000 March 18 Vitol Metro Mistral Amsterdam Karachi 500,000 March 14 TotalEnergies ST Connaught Amsterdam Singapore 400,000 March 17.

Business

Gold Slides to Nearly 4-month Low

FILED - 02 February 2026, Bavaria, Munich: Gold bars lie in a safe on a table at the precious metal dealer Pro Aurum. Photo: Sven Hoppe/dpa
FILED - 02 February 2026, Bavaria, Munich: Gold bars lie in a safe on a table at the precious metal dealer Pro Aurum. Photo: Sven Hoppe/dpa
TT
TT

Gold Slides to Nearly 4-month Low

FILED - 02 February 2026, Bavaria, Munich: Gold bars lie in a safe on a table at the precious metal dealer Pro Aurum. Photo: Sven Hoppe/dpa
FILED - 02 February 2026, Bavaria, Munich: Gold bars lie in a safe on a table at the precious metal dealer Pro Aurum. Photo: Sven Hoppe/dpa

Gold prices slipped more than 2% on Monday, hitting a nearly four-month low, as an escalating Middle East conflict stoked inflation concerns and expectations of higher global interest rates.

Spot gold fell 2.7% to $4,366.94 per ounce as of 0432 GMT, extending losses into a ninth straight session. The metal, which fell to its lowest since January 2 on the day, lost more than 10% last week.

US gold futures ⁠for April delivery ⁠fell 4.5% to $4,369.90, Reuters reported.

"With the Iranian conflict into its fourth week, and oil prices hanging around the $100 level, expectations have pivoted from rate cuts to potential rate hikes, which have tarnished gold's appeal from a yield point of view," said Tim Waterer, chief market analyst, KCM Trade.

"Gold's high liquidity appears to be hurting it during this risk-off period. 

Downturns in stock markets are leading to gold portions being closed to cover margin calls on other assets," Waterer said.

Asian shares fell and oil prices stayed well above $110 a barrel, as investors weighed US and Iranian threats to target energy ⁠facilities.

The closure ⁠of the Strait of Hormuz kept crude elevated, stoking inflation fears by pushing up transport and manufacturing costs. While rising inflation typically boosts gold's appeal as a hedge, high rates curb demand for the non-yielding asset.

Market pricing for a US Federal Reserve rate hike this year has shot up, and is now seen as far more likely than a rate cut, with rate futures pricing in around a 32% chance of a rate hike by December, per the CME FedWatch tool.

Spot silver lost 3.4% to $65.45 per ounce. Spot platinum fell 3.4% to $1,857.67 and palladium was steady at $1,403.10.

Business

Asian Stocks Tumble as Trump Gives Iran 48-hour Ultimatum

The surge in oil prices since the war began have fanned concerns about a fresh spike in inflation. Brandon Bell / GETTY IMAGES NORTH AMERICA/AFP
The surge in oil prices since the war began have fanned concerns about a fresh spike in inflation. Brandon Bell / GETTY IMAGES NORTH AMERICA/AFP
TT
TT

Asian Stocks Tumble as Trump Gives Iran 48-hour Ultimatum

The surge in oil prices since the war began have fanned concerns about a fresh spike in inflation. Brandon Bell / GETTY IMAGES NORTH AMERICA/AFP
The surge in oil prices since the war began have fanned concerns about a fresh spike in inflation. Brandon Bell / GETTY IMAGES NORTH AMERICA/AFP

Stocks tumbled Monday and oil prices rose after Donald Trump and Iranian leaders traded threats over the key Strait of Hormuz, while Israel said the Middle East war could last several more weeks.

With the conflict now in its fourth week and showing no sign of ending, the head of the International Energy Agency warned of the worst global energy crisis in decades and said the world economy was under "major threat" from the crisis.

Observers, meanwhile, have also raised the prospect of a surge in inflation that could force central banks to hike interest rates, while the choking off of fertilizer shipments has also fanned concerns about global food security.

The US president on Saturday gave Iran 48 hours to reopen the Strait of Hormuz to shipping or face the destruction of its energy infrastructure, reported AFP.

The ultimatum, made just a day after the US leader said he was considering "winding down" military operations, came as the waterway -- through which a fifth of global oil and gas flows -- remained effectively closed.

Trump wrote on Truth Social that the US would "hit and obliterate" Iranian power plants -- "starting with the biggest one first" -- if Tehran did not fully reopen the strait within 48 hours, or 23:44 GMT on Monday, according to the time of his post.

That came a day after Trump ruled out a ceasefire agreement, saying Washington had the upper hand.

Iran warned Hormuz "will be completely closed" if Trump acted on his threat.

And powerful parliament speaker Mohammad Bagher Ghalibaf threatened to irreversibly destroy vital infrastructure across the region, which he said would cause oil prices to rise "for a long time", if Tehran's own infrastructure was hit.

The latest escalation came as Israel's military said it will expand its ground operations in Lebanon against Iran-backed militant group Hezbollah, while a spokesman said the country faced "weeks" more fighting against Iran and Hezbollah.

The escalation hammered stock markets, with Seoul and Tokyo -- which had been the standout performers before the war started -- taking the brunt of the selling, shedding as much as six and five percent, respectively, at one point.

Hong Kong shed more than three percent, while Shanghai, Taipei and Manila all lost more than two percent. Sydney, Singapore and Wellington were also deep in negative territory.

South Korea's won dropped to 1,510 won per dollar, its weakest level since 2009.

Oil prices edged up, with Brent sitting around $112 and West Texas Intermediate just below $100.

- Deadline focus -

"The outcome and Trump's next steps, particularly in the event of escalation, would have significant implications for markets through the remainder of the week and into month and quarter end," wrote Pepperstone's Chris Weston.

He added that while the president has often pulled back from the brink on issues in the past "has also shown credibility in following through with military action when demands are not met, so markets will place weight on his weekend post on Truth Social".

"If we move past the deadline, focus will quickly shift to the scale of any action against Iran and the nature of Iran's response, particularly toward US bases and its allies."

Meanwhile, IEA boss Fatih Birol said Monday: "The global economy is facing a major, major threat today, and I very much hope that this issue will be resolved as soon as possible.

"No country will be immune to the effects of this crisis if it continues to go in this direction. So there is a need for global efforts."

His remarks came as central banks reconsider their monetary policies amid expectations that the surge in oil prices will send inflation soaring, with the Reserve Bank of Australia last week hiking interest rates.

The prospect of higher borrowing costs has hammered non-yielding gold, which has fallen for eight straight days and just suffered its worst weekly drop since 1983.

Bullion was sitting around $4,350 Monday, having hit a record high of almost $5,600 at the end of January.