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Global institutions have warned that although the world economy has absorbed the initial shock of the war in the Middle East, risks remain elevated, with Nigeria among the countries most vulnerable to renewed disruptions in energy and food markets.

In a joint statement issued after their July 7 meeting, the heads of the International Energy Agency (IEA), International Monetary Fund (IMF), World Bank Group (WBG), and World Trade Organisation (WTO) said the conflict’s impact is uneven, with developing economies facing deeper pressure from inflation, trade bottlenecks, and commodity volatility.

Nigeria’s dependence on imported refined petroleum products, even though the Dangote Refinery’s installed capacity exceeds estimated domestic petrol demand, means that any instability in the Strait of Hormuz could still raise the landing costs for fuel, worsen inflation, and strain government finances. 

The continued reliance on imports reflects a mix of policy bottlenecks in pricing and product certification, FX constraints that complicate local transactions and supply contracts, and industry politics in the downstream sector that have slowed the full integration of domestic output into national distribution channels. 

The institutions stressed that reopening and securing the Strait is essential to stabilising global flows.

Fuel and fertiliser prices have eased since June, but the organisations warned that uncertainty persists. For Nigeria, fertiliser affordability directly affects food production, and higher logistics costs could intensify food inflation, which already remains one of the country’s most persistent economic challenges.

The IMF noted that while the global economy has shown resilience, countries like Nigeria face slower growth and elevated inflation. Rising import bills, currency pressures, and fragile supply chains could complicate Nigeria’s efforts to stabilise prices and support job creation.

The World Bank Group’s emphasis on protecting jobs and strengthening food security aligns with Nigeria’s current policy priorities, especially as households continue to grapple with high living costs.

The four institutions pledged to monitor energy and trade developments closely and adapt support to vulnerable economies. Nigeria, which maintains active financing and advisory relationships with both the IMF and World Bank, could benefit from targeted assistance if conditions worsen.

They also urged governments to invest in resilience across energy, food, and trade systems – areas where Nigeria’s ongoing reforms, including efforts to expand domestic refining capacity and modernise agriculture, remain critical.

Founded in 1974, the IEA coordinates collective responses to energy disruptions. The IMF supports financial stability among its 191 members. The World Bank Group works to end poverty and promote a liveable planet, while the WTO governs global trade rules among 166 members.

Their joint warning underscores that while immediate shocks have been absorbed, long-term risks to growth, price stability, and global trade remain. They pledged readiness to act further if needed.