QNB warns Asia’s energy crisis will persist into 2027

Qatar National Bank released a report on Saturday warning that Asian economies face a protracted energy crisis stemming from the US-Iran military escalation, with regional inflation projected to remain elevated well into early 2027 even as diplomatic efforts advance toward a formal end to hostilities.

A Crisis That Outlasts the Conflict

The QNB report, published in its weekly economic commentary, said the military escalation between the United States and Iran triggered one of the largest disruptions to global energy supplies in decades, and cautioned that a ceasefire alone would not immediately resolve the supply constraints gripping the region. The bank noted that physical infrastructure damage, shipping disruptions through the Strait of Hormuz, and the slow pace of restoring oil and gas flows mean Asian economies will remain exposed to sustained price pressures through at least the first quarter of next year.qna+1

The assessment aligns with broader institutional warnings. The Asian Development Bank in its July update lowered growth forecasts for developing Asia to 4.7% for 2026 and raised its inflation outlook to 5.2%. The IMF, in its updated World Economic Outlook released on July 9, cut its global growth forecast to 3% and projected worldwide inflation of 4.7% for the year.reuters+3

Asia's Vulnerability Exposed

Asia's acute exposure stems from its dependence on Persian Gulf energy — the region sources roughly 85% of its crude oil imports from the Gulf. Oil imports to Asia fell by 30% year-on-year in April, according to Kpler data cited by Reuters, marking the lowest level since 2015. While imports from the United States have surged as a substitute, they have proven insufficient to close the gap. Countries including Thailand, South Korea, Taiwan, and the Philippines face the most direct pressure given their large oil and gas trade deficits.think.ing+2

The June 14 memorandum of understanding intended to bring the war to a formal close within 60 days offered some relief to Asian capitals, but as energy analysts and the QNB report stress, rebuilding supply chains and restoring full production capacity will take months beyond any political agreement.cfr+2

Iran's Economic Freefall

Iran itself faces among the harshest economic consequences. Year-on-year inflation reached 88.6% for the period ending June 21, according to the Statistical Centre of Iran, with food prices rising even more sharply — meat up 178%, bread and cereals up 139%. The IMF projects Iran's economy will contract by 6.1% in 2026. Iran's government has estimated total war damage at $270 billion, roughly equal to the country's entire pre-war GDP.euronews+2