The war and disruption to the Strait of Hormuz have triggered a significant oil shock and led to meaningful downgrades to global growth.  The duration of disruption to shipping traffic in the Strait of Hormuz is the critical known unknown for the global economic outlook, along with how quickly energy production can recover. Trade protectionism and policy uncertainty are likely to persist, although their impact is being partly offset by AI-related investment, strong equity-market wealth effects and expansionary fiscal policy in some countries, particularly the US. Will this combination of AI-driven wealth effects, looser policy and limited tariff drag allow the US to continue outperforming despite the increase in inflation? And does China’s chronic overcapacity — alongside its move into increasingly complex products — mean further headwinds for Europe, especially given the EU’s limited progress in de-risking its supply chains?