Published: · Region: Global · Category: markets

IMF Chief: AI Investment Helping Some Economies Weather Middle East Oil Disruptions

International Monetary Fund head Kristalina Georgieva says artificial intelligence spending is supporting growth in some countries and helping offset the impact of oil supply disruptions from the Middle East war.

Investment in artificial intelligence is starting to influence how some economies absorb the shock from conflict-linked oil disruptions.

International Monetary Fund Managing Director Kristalina Georgieva said that in certain countries, spending on AI is supporting economic growth and helping to cushion part of the impact from oil supply problems caused by the war in the Middle East.

Her comments connect two trends usually discussed separately: the conflict in a major oil-producing region and rising outlays on AI infrastructure, software and services. She did not name specific countries, but pointed to places where AI-driven investment and productivity gains are now visible in growth figures, even as higher energy costs drag on activity elsewhere.

For governments facing inflation and weak demand, the idea that AI can blunt some of the economic damage from higher oil prices is appealing. Large AI projects require significant spending on hardware, cloud capacity and specialized workers, boosting investment and supporting related exports. As these systems start to automate tasks or enable new products, they can add to productivity and corporate profits, feeding back into tax revenues and financial markets.

The war’s impact on oil supply has so far centered on risk and disruption rather than a complete halt in flows. Shipping detours, higher insurance costs and fears of attacks near key routes have kept a floor under prices and lifted costs for importing states. Poorer, fragile economies without sizeable technology sectors feel this pressure directly in budgets and household bills.

By contrast, advanced and some large emerging economies with stronger digital industries are seeing AI spending partially replace weaker consumption and more cautious traditional investment. That doesn’t remove their exposure to a sharper disruption or sudden price spike, but it helps explain why global growth forecasts have not fallen as steeply as past conflicts in big producing regions might suggest.

For policymakers, Georgieva’s assessment underlines a divide. Countries pouring resources into AI may gain an extra layer of resilience, while those without the means or skills to do so face oil-driven strain without much technological offset.

Signals to watch include any IMF growth forecast revisions that cite AI investment, updated views on how long oil supply disruptions from the Middle East could persist, and whether central banks and finance ministries reference AI-related activity when explaining interest rate decisions or new economic support measures.

Sources

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