Iran War Leaves World Finance Officials in a Gloomy Mood

US News Authored by: Samannay Biswas Updated Apr 18, 2026, 02:13 IST This week’s annual spring meetings of the IMF and World Bank in Washington focused heavily on the implications of the Iran conflict and its resulting oil supply disruption. On Friday, oil prices dropped sharply and stocks rallied after both Trump and Iran said the Strait of Hormuz was open again. The mood was heavy this week at the annual spring meetings of the International Monetary Fund and World Bank in Washington. Finance ministers, central bankers, and investors from around the world gathered as usual, but the conversations were dominated by one thing: the war with Iran and the massive oil supply shock it has triggered. Many participants said the economic fallout could drag on for weeks or even months. The closure of the Strait of Hormuz has created what the International Energy Agency called “the most severe oil supply shock in history” — worse than the disruption caused by Russia’s invasion of Ukraine in 2022. Saudi Finance Minister Mohammed Al-Jadaan put it bluntly on a panel Thursday: “Anyone who’s counting on a quick recovery, even if there is a total end of hostilities, will need to recalculate that.” At dinners and side meetings, officials and investors tried to figure out what the Trump administration really wants in the conflict. Several expressed worry that markets are still being too optimistic about how bad things could get.The gloom stood in contrast to the more upbeat tone coming from U.S. bank CEOs and some American officials. Treasury Secretary Scott Bessent told a group of investors Tuesday night that he was optimistic about negotiations with Iran and even suggested the war in Ukraine could wrap up within three months. On Friday, oil prices dropped sharply and stocks rallied after both Trump and Iran said the Strait of Hormuz was open again. But many analysts warned that the announcement may not be enough to convince shipping companies to resume normal traffic right away. European officials sounded particularly concerned. France’s Economy Minister Roland Lescure said he now holds a “crisis meeting” every morning at 8 a.m. to check on fuel supplies. France has started subsidizing fuel costs for key industries like transport, farming, and fishing.“We’re kind of living one month to the next,” Lescure said. “It’s not about the price. It’s about whether we are getting oil, are we getting gas.” Because of the war, the IMF has cut its global growth forecast for 2026 to around 3%, with a warning it could fall as low as 2% if the oil shock deepens and pushes more countries into recession. Bessent pushed back, saying the IMF had “probably overreacted.”Some oil-exporting nations, including the U.S., may be somewhat shielded from the worst effects, but experts warned that several countries are now just “one shock away from default.” The meetings also highlighted growing divisions between Europe and the United States. Tensions over America’s interest in Greenland and Europe’s reluctance to get more involved in the Middle East were hard to ignore. Hans Humes, CEO of Greylock Capital, described the atmosphere as “the smoking crater of what used to be the relationship between Europe and the United States.” Still, Group of Seven finance ministers agreed on one point: Iran is the main problem. They promised to work together to keep their economies stable through the turmoil.As one French official put it: “It’s not time for bickering.” Samannay Biswas author Working as Copy Editor at the Business Desk of Times Now Digital. Dedicated towards crafting interesting financial stories. Previously covered financi... View More News World News US US News End of Article