The IMF sees an AI demand boom temporarily offsetting an oil shock—while globalising both risks

Global growth is tracking near 3% in 2026—roughly the forecast made 18 months ago despite war, oil around $100, trade conflict and higher borrowing costs. IMF managing director Kristalina Georgieva’s explanation is not that the shocks were mild: the Middle East conflict is a negative supply shock, while investment in AI is a positive demand shock large enough to offset it.

Neither side of that balance is secure. Increased production and stockpiles have softened the energy shock, but winter demand could lift refined-product prices, renew inflation and force central banks to tighten further. Advanced economies would then pay higher interest on historically large debts precisely when households expect relief from living costs.

The AI boom has its own timing mismatch. Capital spending and financing arrive before broad productivity gains, so current growth depends on investor enthusiasm surviving until deployment justifies the infrastructure. If money retreats, losses will not stay in Silicon Valley: Malaysia, Thailand, Singapore and other economies are embedded in the chip and data-centre supply chain. Diversification stabilises production, but also distributes the downturn.

Emerging markets bear a separate transmission channel. Treasury yields near 5% lift the return investors can earn without taking emerging-market risk, eroding the lower borrowing spreads that fiscally disciplined countries spent years achieving. Georgieva described this as punishment for someone else’s sins. She does not yet see corporate AI borrowing crowding out the US Treasury, but considers it a risk worth monitoring.

This is not an IMF forecast of an imminent AI crash. It is a warning against treating one temporary demand surge as a permanent solution to weak productivity and excessive public debt. AI may ultimately deliver gains comparable to earlier general-purpose technologies; the dangerous period is the interval in which governments and investors spend as if those gains have already arrived.