A prolonged surge in global energy prices triggered by the ongoing conflict in the Middle East could signifi cantly weaken Bangladesh’s economic outlook in FY2026-27, with fi nance offi cials warning of slower economic growth, higher inflation and mounting pressure on the country’s external and fi scal balances.
According to offi cial assessments prepared ahead of the national budget, a sustained increase in oil prices could reduce Bangladesh’s GDP growth to around 4.5 percent in FY27, well below the baseline projection of 6.5 percent.
Although the economy is expected to recover gradually in subsequent years, offi cials believe it may fail to return to its original growth trajectory.
The report warns that if international oil prices rise by an additional 30 percent during FY27, inflation could climb to 9.1 percent, compared with the baseline forecast of 7.5 percent, disrupting the government’s efforts to bring down price pressures.