World Bank warns Pakistan of strain from Middle East conflict
The World Bank warns Pakistan that a longer Middle East conflict could keep energy prices high and drain foreign exchange reserves, while a strong El Nino adds a separate risk.
The World Bank says a longer Middle East conflict could keep energy prices high and add pressure on Pakistan's reserves.
The fighting began on February 28, 2026, when the US and Israel launched strikes on Iran, disrupting shipping in the Strait of Hormuz.
Petroleum and gas made up about a quarter of Pakistan's imports in FY2025, and Gulf states supplied roughly 80% of energy imports.
The crude petroleum import bill rose 46.4% in January to June 2026.
The baseline growth forecast is 3.8% for FY2027; a zero crop-growth scenario would cut it to 3.6%.