Global Economic Outlook: Navigating Growth, Risk, and Opportunity | Global Conference 2026

Why It Matters

The prolonged Hormuz disruption threatens global growth, inflates commodity prices and forces businesses to confront stagflation, making swift policy action and supply‑chain resilience essential.

Key Takeaways

• Hormuz closure cuts 14 M bpd, straining global oil supply.
• Buffers—strategic reserves, floating stock—rapidly depleting, pushing prices up.
• Inflation and food costs could rise 3‑6% as oil stays high.
• Developing economies face severe recession risk without fiscal reserves.
• CEOs largely unprepared for prolonged energy shock and stagflation.

Summary

The panel opened by framing the global economy’s two dominant shocks: an unprecedented energy disruption from the Strait of Hormuz closure and the rapid diffusion of artificial intelligence. Speakers agreed that the Hormuz shutdown, which removed roughly 14 million barrels per day – about 20% of global flow – is the immediate catalyst for heightened volatility.

Mike Worth explained that commercial inventories, floating tankers and strategic reserves have already been tapped, leaving the market with thin physical buffers while Brent futures, a financial contract, understate true spot prices. Cristina Giorgi ever warned that oil prices above $100‑$125 per barrel could lift global inflation, push food and fertilizer costs up 3‑6%, and strain supply chains from chips to petrochemicals. The IMF’s adverse scenario now replaces the earlier mild outlook, reflecting a slowdown to around 3% growth.

Notable remarks included Worth’s “physical barrels are pricing much higher than the Brent quote,” and Kande’s observation that “most CEOs were not prepared for this shock.” Ariel Shashstein highlighted that Latin America, as a net exporter, can leverage the crisis to accelerate digital commerce and financing, while also feeling the pinch of higher input costs.

The discussion underscored an asymmetric impact: wealthy oil‑rich nations retain fiscal space, whereas many developing economies risk deep recession without reserves. Policymakers risk exacerbating the problem by protecting demand rather than curbing consumption. Resolving the Hormuz impasse and aligning policy with supply‑side realities will be crucial for averting a broader stagflationary spiral.

Original Description

Watch all 2026 Global Conference session replays: https://milkeninstitute.org/events/global-conference-2026/program

Macroeconomic forces are shaping today’s business environment, from labor markets and trade flows to geopolitical risk and monetary and fiscal policy. These interconnected factors are influencing investment decisions, capital allocation, supply-chain strategies, and long-term competitiveness. Key structural shifts—such as demographic change, technological adoption, and evolving regulatory frameworks—are reframing perspectives on productivity, resilience, and sustainable growth. This session will highlight how leading global corporations are balancing short-term volatility with long-term value creation in an increasingly complex and fragmented global economy.

Conrad Kiechel

Executive Director, Global Programming, Milken Institute

Zanny Minton Beddoes

Editor-in-Chief, The Economist

Kristalina Georgieva

Managing Director, International Monetary Fund

Mohamed Kande

Global Chairman, PwC

Ariel Szarfsztejn

CEO, Mercado Libre

Mike Wirth

Chairman of the Board and CEO, Chevron Corporation