Malaysia's export outlook faces rising downside risks despite a sustained AI-driven upcycle, as Middle East tensions dampen global growth, disrupt supply chains and raise input costs, according to economists.

Rising tensions in the Middle East are no longer viewed solely as a short term geopolitical shock.

The global energy market experienced a sharp shift as oil prices fell significantly following signals from Iran that commercial shipping would resume through the strategically critical Strait of Hormuz.

The world is entering an era in which long-standing security guarantees are sounding increasingly unconvincing, while new centres of power are only beginning to outline the contours of a future order.

The Central Bank of Bahrain has announced a series of measures aimed at supporting the economy and financial sector as regional conflict weighs on growth and stability.

Malaysia is moving to diversify its supply of key raw materials and medical products amid growing concerns over disruptions linked to conflict in the Middle East, officials say.

Finance ministers and central bank governors from the ASEAN have warned that rising geopolitical tensions, including instability in the Middle East, pose growing risks to the global and regional economy.

The Strait of Hormuz, just 39 km (24 miles) wide at its narrowest point, sees around 20 million barrels of oil passing through daily—about 25 percent of the world’s maritime oil trade.

Spain, Germany, Italy, Austria, and Portugal have officially urged the European Commission to implement a unified windfall tax on energy companies, citing the surge in oil prices due to the ongoing war in Iran.