Effects of the Iran war will be felt for years to come

The re-opening of the Strait of Hormuz will trigger a recovery in the Gulf economies, but the damage already inflicted means these economies will still record sharp falls in GDP over this year as a whole. And the conflict will leave a lasting legacy. This is likely to include a rethink of diversification plans and efforts to raise oil output more quickly. In North Africa, Egypt and Morocco will emerge from the energy spike relatively unscathed but Tunisia may still be heading for a sharp devaluation and sovereign default.