United Nations Secretary-General Antonio Guterres has issued a stark warning that the continued disruption of maritime traffic through the Strait of Hormuz could trigger a global recession.

Speaking in New York, he urged the reopening of the strategic waterway, stressing that the longer it remains blocked, the higher the cost to humanity. His message was unequivocal: the strait must be opened to allow ships to pass freely and to let the global economy breathe again.

Guterres cautioned that if freedom of navigation is not restored by the end of the year, the world could face severe economic consequences. He outlined a scenario in which persistent disruptions would drive inflation above six per cent, reduce global growth to two per cent, and inflict immense suffering, particularly on vulnerable populations.

He warned that such conditions would bring about a global recession with dramatic impacts on economies, societies, and political stability worldwide.

He explained that even in the best-case scenario, where restrictions are lifted immediately, supply chains would take months to recover. Global growth would fall from 3.4 to 3.1 per cent, inflation would rise to 4.4 per cent, and trade would slow sharply. He noted that a world already reeling from the pandemic and the war in Ukraine would endure further economic distress under these conditions.

The UN chief highlighted that the Middle East crisis has now entered its third month. Despite a fragile ceasefire, the consequences of the disruption are worsening by the hour. He expressed deep concern about the curtailment of navigational rights and freedoms in the Strait of Hormuz, warning that it is impeding the delivery of oil, gas, fertiliser, and other critical commodities, thereby strangling the global economy.

He stressed that humanity as a whole is paying the price, even as a few actors reap huge profits, and that the pain will be felt for years to come.

Guterres outlined a second scenario in which disruption drags on through midyear. This would push 32 million people into poverty, cause fertiliser shortages, reduce crop yields, and leave 45 million more people facing extreme hunger. With Brent crude oil prices hovering around $118, the prospect of fuel and gas shortages has heightened urgency in capitals across the world to find solutions quickly.

Dario Liguti of the UN Economic Commission for Europe warned that Southeast Asia and South Asia were the first to be hit by the most severe energy crisis in a generation.

He added that the crisis is unfolding globally, with European motorists already bracing themselves for rising costs at the pump. Guterres pointed to diplomatic efforts underway, including a UN Task Force led by the head of UN Project Services to establish a humanitarian corridor. The International Maritime Organization is also developing a framework to evacuate ships and seafarers if safe passage can be guaranteed.

The International Monetary Fund, in a report published last month, warned that prolonged conflict, worsening geopolitical fragmentation, and renewed trade tensions could significantly weaken growth and destabilise financial markets.

It noted that the closure of the Strait of Hormuz and damage to critical facilities in a region central to global hydrocarbon supply raised the prospect of a major energy crisis if hostilities continue.

The crisis stems from US and Israeli attacks launched on 28 February, followed by Iranian retaliation against energy facilities across West Asia. Israel also struck energy sites in Iran. Although Washington and Tehran agreed to a two-week ceasefire that temporarily halted military attacks, traffic through the Strait of Hormuz remains restricted, prolonging the economic and humanitarian fallout.

ANI