The Global Economy... Between Hormuz and Artificial Intelligence
The global economy entered 2026 facing a rare paradox. On one hand, geopolitical tensions—most notably Iran’s threats to the Strait of Hormuz, one of the world’s most vital arteries for energy and trade—are escalating. On the other, the artificial intelligence revolution is accelerating, driving the most significant productive transformation since the digital revolution. Between these two dynamics, the challenge is no longer solely about growth rates, but rather the global economy’s ability to maintain stability amid rising risks and the growing cost of uncertainty.
At the start of the year, expectations had bet on a “soft landing” following waves of inflation and monetary tightening. However, geopolitical escalation dispelled those hopes, prompting international institutions to downgrade growth forecasts as investor confidence waned, investments were postponed, and financing costs rose.
Against this backdrop, sovereign debt is becoming an ever heavier burden, as countries are forced to divert resources toward debt servicing at the expense of development spending, while capital flows into safe-haven assets and emerging markets face mounting pressures. Yet the greatest risk lies not in slowing growth, but in a supply shock stemming from disruptions to energy supplies. A disruption to the flow of oil and gas through the Strait of Hormuz would not only drive up energy prices but also increase production, transportation, insurance, and shipping costs, thereby reviving the dynamics of stagflation, where economic activity contracts alongside persistently rising prices. The repercussions extend beyond energy to global supply chains, heightening the vulnerability of industrial economies reliant on cheap energy and maritime trade. Europe faces inflationary pressures that delay monetary easing, while the United States is affected by rising transportation and industrial costs. The crisis also spills over into food, fertilizers, and raw materials, transforming an energy crisis into a global cost-of-living crisis. Although Gulf states benefit from higher oil prices, they face risks to their exports, ports, and investments, making the acceleration of economic diversification, the development of alternative export routes, and the enhancement of logistics a strategic imperative.
Conversely, artificial intelligence represents the most significant positive shock capable of mitigating some of the impacts of geopolitical disruptions. Investments in data centers, semiconductors, and digital infrastructure boost productivity and redistribute economic power in favor of nations possessing technology, computing capabilities, and data. Gulf states have an opportunity to convert their financial surpluses into investments in the knowledge economy, thereby strengthening their position in the global digital economy. However, no amount of innovation can compensate for energy insecurity or the disruption of maritime corridors.
By 2027, the global economy is likely to evolve along three scenarios: the first involves containing tensions and stabilizing energy markets, allowing growth to return and inflation to subside; the second, and most probable, entails continued uncertainty with modest growth led by Asian economies and AI investments; and the third, the costliest scenario, features escalating conflicts or navigation disruptions in the Strait of Hormuz, plunging the world back into stagflation and subjecting Gulf economies to a severe test. The global economy is not experiencing a traditional economic cycle, but rather a reshaping of power balances. Nations capable of combining energy security, technological sovereignty, and institutional resilience will be best positioned to lead the global economy. For Gulf states, success will not be measured by oil prices, but by their ability to convert energy revenues into a diversified, innovative, and more crisis-resilient economy. Between the Strait of Hormuz and AI chips, the shape of the new global economy is being defined.
