Pakistan's economy comparatively resilient despite Hormuz energy shock: World Bank

Pakistan's economy has stayed relatively robust despite the energy shock tied to the Gulf conflict and disruption in the Strait of Hormuz, Profit reported, citing the World Bank. The lender expects growth to reach 3.7% in FY2025-26, up from 3.2% in FY2024-25, as services, manufacturing and livestock output hold up. Higher commodity and freight costs are nonetheless pushing inflation and external balances under strain.

The bank's October 2026 regional update covering the Middle East and North Africa finds that oil importers have fared better than hydrocarbon exporters, which face lost output and shipments. Oil importers feel the conflict mainly through dearer fuel, food, shipping and insurance, which weaken external accounts and add to price pressures. In Pakistan, gasoline prices rose by 40% or more after the conflict began, and inflation reached about 11% by midyear.

The wider region's economy is projected to contract 2.1% in 2026, with GCC economies falling 4.3%, because export volumes rather than prices now bind. Global growth for 2026 was trimmed only 0.1 percentage point to 2.5%, helped by an existing oil surplus and weaker East Asian demand. The bank's baseline case assumes disruption eases from early 2027, although a longer conflict or renewed Hormuz restrictions would prolong the pressure.