This aerial view shows the headquarters of the Saudi Arabian Oil Company (Saudi Aramco) in Dhahran in eastern Saudi Arabia on October 14, 2026. (AFP Photo)
The International Monetary Fund expects energy-rich Middle Eastern economies to bounce back, but not in the medium term, the organisation's regional chief said on Oct. 15, as fighting continued between Saudi Arabia and Yemen's Houthis.
The statement comes as the IMF projects a widespread contraction in Gulf economies following months of war that began in Iran and has now spread to Saudi Arabia and Yemen, with maritime energy traffic still impacted.
"We will not go back to the pre-war trajectory in the medium term because this shock will have a scarring impact on various sectors and also will disrupt a certain number of infrastructure, and will require additional spending in order to increase resilience," IMF regional director Jihad Azour told reporters.
The IMF on Oct 13. released projections showing that the Middle East and Central Asia region, directly exposed to the Iran war, is expected to contract 0.3 percent in 2026.
Saudi Arabia is among the worst affected, with its economy projected to shrink 3.3 percent.
The projection points to a rare recession for the Gulf kingdom, which has long been buffered by robust energy exports.
On Oct. 14, IMF chief Kristalina Georgieva warned that ongoing attacks targeting Saudi Arabia could affect people "everywhere."
A violent battle between a Saudi-led coalition and Yemen's Houthis has sharply escalated in recent days, with fatal missile strikes hitting airports and energy facilities, as well as the headquarters of the kingdom's state oil giant Aramco.
