# Middle East war may reduce Thailand’s economic growth in 2026 by 0.3–0.8%

- Link: https://www.thailand-business-news.com/economics/295825-the-middle-east-conflict-may-reduce-thailands-economic-growth-in-2026-by-0-3-0-8
- Published: 2026-03-24T10:41:17+07:00
- Author: Economic Intelligence Center Siam Commercial Bank

**SCB EIC predicts 2–6 weeks disruption in Strait of Hormuz, raising Brent oil to
$75–$107/bbl, causing slower Thai growth, rising inflation, supply risks, and cautious
global monetary policies amid Middle East conflict.**

### Key Takeaways

 * **Growth slowdown**: Thailand’s GDP growth may be **0.3–0.8 pp slower** depending
   on severity of conflict.
 * **Inflation**: Expected to rise to **1.5%**, returning to the 1–3% target range
   sooner. In worst‑case escalation, inflation could exceed **4%**.
 * **Policy response**: The Monetary Policy Committee (MPC) may have room to ease
   interest rates further.

## Impact on Energy Prices and Strait of Hormuz

SCB EIC forecasts that under the base case, the Strait of Hormuz will be closed 
for 2–6 weeks due to attacks on energy infrastructure. This disruption would raise
the average Brent crude oil price to USD 75 per barrel. If the conflict escalates
into a regional war, energy transportation could be severely disrupted, pushing 
Brent crude prices up to USD 107 per barrel.

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## Global and Thai Economic Effects

The global economy faces downside risks from these developments, with inflation 
rising about 0.4 percentage points and GDP growth slowing by 0.2–0.4 points. Rising
inflationary pressures may delay monetary easing by major central banks. **For Thailand,
economic growth in 2026 could slow by 0.3–0.8 percentage points** depending on oil
prices, while inflation may return to target sooner or exceed 4% if tensions worsen.

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## Risks to Thai Business Sectors

Thai businesses face both direct and indirect risks from the Middle East conflict.
While exports to the region are limited, certain industries like agriculture, food,
and passenger vehicles rely on it. Rising energy costs, transportation disruptions,
and raw material price increases affect supply chains, impacting tourism and healthcare.
However, key agricultural products may see increased demand and benefit from rising
global prices.

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