Gita Gopinath Warns Rising Oil Prices May Slow Global Growth, Raise Inflation in 2026

Gita Gopinath, former IMF Chief Economist, warned that rising crude oil prices driven by the Iran conflict could slow global economic growth and increase inflation in 2026. She stated that if oil averages around USD 85 per barrel next year, global growth could decline by 0.3 to 0.4 percentage points from a prior 3.3% projection, while headline inflation might rise by about 60 basis points. The surge follows disruptions in the Strait of Hormuz amid escalating Middle East tensions.