The International Monetary Fund (IMF) has raised its growth outlook for Russia, projecting GDP expansion of 1.1% in 2026, up 0.3 percentage points from its January forecast. The revision reflects higher global commodity prices, driven largely by renewed Middle East tensions that have disrupted energy markets. The IMF also expects Russia’s momentum to continue into 2027, with inflation forecast to ease from 8.7% in 2025 to 5.6% this year and 4.3% in 2027.
Russia’s Economic Development Ministry has offered a more optimistic projection, estimating GDP growth of 1.3% in 2026 and 2.8% in 2027. The IMF’s upward revision comes as the US-Israeli conflict with Iran and Tehran’s retaliatory strikes have rattled global energy supply, effectively choking flows through the Strait of Hormuz—a critical route for a significant share of the world’s oil and gas.
The fund warns that sustained hostilities could trigger a “major energy crisis,” with countries heavily dependent on energy imports particularly exposed. Against this backdrop, the IMF has downgraded its global growth forecast to 3.1% in 2026, down from 3.4%, before a modest rebound to 3.2% in 2027. Without the Middle East conflict, global growth would have been revised upward.
The euro area has also seen its outlook cut, reflecting the conflict’s negative impact alongside lingering effects from higher energy prices since the escalation of the Ukraine conflict. Manufacturing activity has been dragged down, compounded by pressure from the euro’s appreciation.
IMF Managing Director Kristalina Georgieva warned last week that the Middle East conflict has delivered a major global energy supply “shock,” with world oil output already down by 13%. The disruption is rippling across energy, commodities, and fertilizer markets, underscoring the conflict’s broad economic consequences.
