The World Bank says it is prepared to provide up to $100 billion in financial support over the next 15 months to help developing countries manage the economic impact of the escalating crisis in the Middle East.

The lender made the disclosure in its latest Global Economic Prospects Report released on Thursday, warning that the conflict could weaken global growth, fuel inflation and increase borrowing costs across vulnerable economies.

According to the report, global economic growth is projected to slow from 2.9 per cent in 2025 to 2.5 per cent in 2026, before a modest recovery to 2.8 per cent in 2027. The World Bank noted that growth forecasts for nearly two-thirds of the world’s economies have been downgraded since January.

The institution said it has already made between $50 billion and $60 billion available through existing financing mechanisms, including $25 billion in pre-arranged funding, to support countries affected by the crisis.

The funds are expected to help governments strengthen social safety programmes, stabilise public finances and provide liquidity for businesses and agricultural sectors facing economic pressure.

“To date, over 30 countries are actively working with the World Bank Group to enhance readiness and enable a rapid response to the crisis under this response plan. If the conflict and its economic fallout persist, the World Bank Group can scale up its support to $80–100 billion over 15 months,” the report stated.

The World Bank also warned that disruptions to global energy markets, particularly through the closure of the Strait of Hormuz, have increased pressure on oil prices.

It projected that Brent crude oil would average $94 per barrel in 2026, about 36 per cent higher than in 2025, assuming major supply disruptions ease by July.

The report further noted that rising fertiliser costs could drive food inflation globally, with overall inflation expected to rise to 4.0 per cent in 2026, compared to 3.3 per cent in 2025.

World Bank Group President Ajay Banga said governments must balance immediate economic relief with long-term growth strategies.

“The impact differs by country, but the basic test is the same: protect people and preserve stability today, without giving up on growth and jobs tomorrow,” Banga said.

He added that the institution remains ready to deploy additional financing, guarantees and private-sector support if the crisis deepens.

The report warned that a worsening conflict could further slow global growth to 1.3 per cent in 2026 while pushing inflation to 4.4 per cent.

For developing economies, growth is expected to decline from 4.4 per cent in 2025 to 3.6 per cent in 2026, before recovering to 4.2 per cent in 2027.

The World Bank said Sub-Saharan Africa could face higher inflation and food prices due to fertiliser shortages and rising production costs, while countries in the Gulf region directly affected by the conflict are expected to record the sharpest economic slowdown.

The report also raised concerns over rising debt burdens in developing nations, noting that average public debt levels have increased from less than 40 per cent of GDP in 2010 to more than 70 per cent today, limiting governments’ ability to respond to economic shocks and invest in critical sectors.