Mar­i­ano Browne

The world is cur­rent­ly in tur­moil. Is there a cease­fire in the Mid­dle East, or isn’t there? If the war con­tin­ues, how much longer will it last, and how much more dam­age will be done to the en­er­gy in­fra­struc­ture and ul­ti­mate­ly to glob­al sup­ply chains? Fi­nan­cial mar­kets have been volatile, re­spond­ing pos­i­tive­ly to every glim­mer of peace, on­ly for those hopes to be dashed when more mis­siles land. What has been the im­pact of the war so far?

The Gulf states, which are par­ty to the con­flict (Bahrain, Iran, Iraq, Kuwait, Sau­di Ara­bia, Unit­ed Arab Emi­rates), have suf­fered re­al and last­ing dam­age to their in­fra­struc­ture and im­age that will take years to re­build. The full im­pact of the war on the in­ter­na­tion­al econ­o­my has not yet been felt, and the glob­al im­pact has been un­even. The war will have a mul­ti-chan­nel macro­eco­nom­ic im­pact. The im­pact can be seen through sev­er­al mech­a­nisms, which will in­ter­act: en­er­gy, in­fla­tion, trade, fi­nan­cial con­di­tions, and geopo­lit­i­cal re­struc­tur­ing. Some of these im­pacts are al­ready vis­i­ble.