The post Global economy gets downgrade as Middle East conflict disrupts energy supply, trade routes appeared on BitcoinEthereumNews.com.

The global economy just got downgraded, and the reason is clear. The OECD said on Thursday that the war tied to the U.S. and Israel attacking Iran is now hitting growth and pushing prices higher across the economy. Before this conflict, the global economy was actually doing better than expected, with the OECD saying that Trump’s tariffs last year did not break growth. The OECD added that it was preparing to raise its forecast to 3.2% from 2.9%. That improvement came from strong AI investment and lower interest rates. Then late February changed everything, as major headlines became dominated by America and Israel’s war on Iran, where key energy and transport sites were damaged. The Strait of Hormuz became restricted and has now been “officially halted for all enemies of Iran,” according to their Foreign Minister Abbas Aragchi. War disrupts energy supply and drags global growth projections down The OECD said the economy is now being pulled in two directions. Asa Johansson, the policy studies director, said, “The forecast is shaped by two counteracting forces.” Asa said the economy was stronger than expected at first, then the war started dragging it down. She also said the situation is uncertain because no one knows how long the energy shock will last or how wide it will spread. The OECD kept its 2026 global growth outlook unchanged under a base case where energy prices fall later this year. But it also gave a worse scenario. If energy stays expensive, the economy grows just 2.6% this year. That is more than half a percentage point below what was expected before the war. The hit in 2027 would be bigger. Country forecasts show a split inside the economy. The U.S. outlook was raised to 2% from 1.7%, supported by AI spending. Europe moved the…

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Filed under: News - @ March 26, 2026 12:28 pm