15/04/2026 01:07 AST
The Managing Director of the International Monetary Fund, Kristalina Georgieva, affirmed that the strength of the Gulf states' economic fundamentals contributed to supporting the stability of the region's economies during the war between the US and Iran.
During a joint press conference with the Executive Director of the International Energy Agency, Fatih Birol, Georgieva stated in response to questions from Asharq News that the Gulf states had worked over the past decade to "build strong foundations, implement sound policies, and establish buffers," and that this "benefited the entire region, as its strength was transferred to others."
She added that the assessment of the crisis's impact varies among countries, depending on whether a country is an energy exporter or importer, as well as the strength of its policies and economic fundamentals. She noted that nations with strong institutions are better able to withstand crises, even under market restrictions, a point also emphasized by Birol in his response to Asharq News' question.
This is not the first time during the war that Georgieva has praised the Gulf economies and their diversification efforts. On April 6, she affirmed that their economies were capable of absorbing the shocks of the war, despite being affected by it, thanks to their "efforts in building diversified economies with strong institutions."
Supporting affected countries
The Iran war, which erupted at the end of February, led to a near-closure of the vital Strait of Hormuz, choking off crude oil and gas supplies from the region destined for global markets and prompting some producers to halt production as storage facilities reached capacity.
This war also resulted in a massive surge in oil prices, which remain more than 40 percent higher than pre-war levels. The energy shock has raised concerns about rising global inflation and cast doubt on global growth forecasts, at a time when economic crises are beginning to unfold in many countries.
In recent times, the IMF and the World Bank have begun preparing for the possibility of affected countries requesting emergency funding.
Last week, World Bank President Ajay Banga indicated that the institution might be able to mobilize between $20 billion and $25 billion in rapid financing for countries facing the repercussions and is exploring the possibility of providing an additional $50 billion to $60 billion in assistance.
In response to a question from Asharq News, Georgieva noted that the institution does not anticipate a significant increase in demand for IMF resources because "emerging economies alone have, over the past decade, built strong institutions, independent central banks, fiscal boards, and robust reserves that mitigate the impact on themselves and the world."
The repercussions of the war vary from country to country
For his part, IEA Executive Director Birol confirmed that Middle Eastern countries are divided into two main groups: oil exporters and non-exporters, pointing out that there are significant disparities even within the exporting countries themselves in terms of their ability to cope with shocks.
He underlined that Lebanon faces an extremely difficult situation among non-exporting countries, while some exporting nations suffer from economic fragility. He cited Iraq, where about 90 percent of government revenues depend on oil, making it more vulnerable to shocks, especially given the nearly two-thirds drop in its oil revenues due to the war.
In contrast, Birol noted that Saudi Arabia enjoys a stronger financial position, praising its actions regarding the East-West pipeline, in addition to its oil storage capacity, which gives it greater flexibility compared to other countries lacking such capabilities.
Since the beginning of the war, Saudi Arabia has been quick to divert supplies to the East-West pipeline for exports from the Red Sea, especially after increasing the pipeline's export capacity to about 7 million barrels per day, from about 800,000 barrels per day before the war.
These steps have helped alleviate supply concerns in the market, effectively curbing the rise of oil prices to record levels.
On April 9, markets held their breath after the Kingdom announced that an Iranian attack on the Manifa oil processing plant had reduced its production by about 300,000 barrels per day. The Khurais oil processing plant had previously been targeted in a similar attack, which also limited its output by the same amount, bringing Saudi Arabia's total production capacity down by about 600,000 bpd.
A pumping station on the East-West pipeline was also attacked, resulting in a loss of about 700,000 bdp of pumping capacity. However, the Kingdom was able to restore full operational capacity within days, which reassured markets.
Arab News
Please wait...
