Many people are aware that the war between Israel and Palestine can have enormous consequences for everyone. Although reading this, many consider it a new world war (which we certainly do not rule out), it is a completely different matter.
The World Bank issued a warning in a report on Monday, stating that a conflict between Israel and Hamas could lead to a surge in commodity prices, including oil and agricultural products, if the situation escalates across the Middle East.
This conflict could continue for some time and thus create huge problems for everyone. Prices could rise rapidly and be unbearable. The timing of this conflict coincides with Russia's ongoing war in Ukraine, which has already exerted pressure on global markets.
According to World Bank chief economist Indermit Gill, this war represents the most significant shock to commodity markets since the 1970s, with long-lasting repercussions on the global economy. The world is in a difficult situation, considering that war reigns on two fronts.
On the one hand, Ukraine and Russia are in constant conflict, while on the other hand, Israel and Palestine also do not give up their goals. Someone is going to have to do something.
Gill and his statement
Gill emphasized the need for cautious policymaking, stating, "If the conflict were to escalate, the global economy would face a double energy shock for the first time in decades, stemming from both the war in Ukraine and the conflict in the Middle East." The potential price increases will largely depend on the developments in world oil prices and exports, as noted by the World Bank.
In an optimistic scenario, oil prices could rise by 3-13 percent, ranging from $93 to $102 per barrel. In a more challenging scenario, oil prices could peak between $140 and $157 per barrel, potentially surpassing all-time highs not seen since 2008.
It seems that the world is facing a severe economic crisis that will create enormous problems. If the conflicts continue on both fronts, the entire planet could find itself in a huge problem on a large scale.
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