The global economy is weeks away from a recession due to the energy crisis spurred by Donald Trump's war with Iran, according to financial experts.
Roughly 80 countries have already imposed emergency fuel rationing as oil prices threaten to climb above $180 a barrel. The spike is driven by the closure of the Strait of Hormuz, the narrow waterway through which about one-fifth of the world's oil passes.
Economists and traders predict that unless the war ends soon, another spike in energy prices, broader fuel rationing, industrial shutdowns and a sharp slowdown in global growth, according to the Financial Times. JPMorgan estimates oil inventories across developed economies could approach 'operational stress levels' by June.
'[If the Iran war] does not end in the coming weeks and we don't have the reopening of the Hormuz strait, I'm afraid a world recession could be on the table,' EU transport commissioner Apostolos Tzitzikostas told the outlet.
The looming summer is also making matters worse. JPMorgan Demand for air conditioning and holiday travel is set to push consumption of crude oil, gasoline, diesel and jet fuel sharply higher by next month.
Global fossil fuel stockpiles are also drawing down at the fastest pace on record. Australia has pledged $10 billion to increase its fuel and fertilizer reserve supply, while France says it will 'change the scope and scale' of its economic support to shield itself from the fallout.
'We are taking that outcome very seriously,' said Paul Diggle, chief economist at fund manager Aberdeen, when asked about surging inflation and a possible recession. 'We are living on borrowed time.'
The economic fears come as Trump warns Iran that the 'clock is ticking' to reach a peace deal amid reports the president is preparing to resume military strikes.
The global economy is weeks away from a recession due to the energy crisis spurred by Donald Trump's war with Iran, according to financial experts
Roughly 80 countries have already imposed emergency fuel rationing as oil prices threaten to climb above $180 a barrel
The looming summer is also making matters worse. Demand for air conditioning and holiday travel is set to push consumption of crude oil, gasoline, diesel and jet fuel sharply higher by next month
'For Iran, the Clock is Ticking, and they better get moving Fast, or there won't be anything left of them,' Trump wrote. 'Time Is Of The Essence! President DJT.'
Trump is meeting with his top military advisers on Tuesday in the Situation Room to discuss the next steps after he rejected the regime's latest offer to end the war.
Iranian media reported Sunday that the Trump administration had offered no meaningful concessions in response to the Iranian regime's latest proposals, raising fears that negotiations could crumble.
Trump previously said the fragile ceasefire was on 'massive life support' and dismissed Iran's counteroffer as 'totally unacceptable.'