World Bank Forecasts 4.3% Contraction in Gulf Economies in 2026

The World Bank expects Gulf economies to shrink by 4.3% in 2026 as the conflict that began in February continues to impose heavy economic costs on the region.

The bank said the fallout is affecting the Middle East and North Africa, as well as Afghanistan and Pakistan, highlighting the broad reach of the disruption.

For the Gulf’s oil-exporting countries, the closure of the Strait of Hormuz has been the biggest economic burden, according to the bank.

The assessment distinguishes the current crisis from previous energy shocks, with the strait’s closure placing a particularly heavy strain on Gulf oil exporters.