The Asian Development Bank (ADB) has forecast that the Middle East conflict will drive average crude prices to $96 per barrel this year, a sharp increase from the pre-war level of $69, and has slashed its growth projections for developing Asia as disrupted energy shipments continue to cascade through supply chains.

Crude prices may ease to $80 by 2027, the multilateral lender said, but infrastructure damage to Gulf energy facilities means supply constraints will persist for years beyond any ceasefire. The assessment came in a report presented on Wednesday at the ADB’s 59th Annual Meeting in Samarkand by Chief Economist Albert F Park.

“Transit through the Strait of Hormuz remains severely impaired despite the April ceasefire,” Park said. “Physical damage to energy facilities across the Gulf will prolong supply disruptions beyond the end of the conflict—with some repairs expected to take three to five years.”

The report estimates that 6.9 percent of global liquefied natural gas capacity has been damaged. Qatar’s Ras Laffan City LNG facilities alone could require three to five years to restore. Refining infrastructure equivalent to 2.4 percent of global capacity and 2.6 percent of crude production capacity have also been hit, with repairs expected to take months.

The bank now expects growth in developing Asia and the Pacific to fall by 0.4 percentage points to 4.7 percent this year, while inflation may rise 1.6 percentage points to 5.2 percent. South Asia faces a steeper revision: growth is cut from 6.3 percent to 5.7 percent and inflation is forecast to jump 2.6 percentage points to 7.6 percent.

The drag extends well beyond crude. Non-oil commodities, notably urea fertiliser, have also risen sharply because the region imports roughly 35 percent of its fertiliser from the Middle East. Bangladesh, which depends heavily on Gulf countries for its fertiliser supplies, is particularly exposed. Higher urea prices risk rapidly pushing up farm costs and food prices.

“Food prices typically follow within one quarter,” Park warned.

The ADB urged governments to protect vulnerable households and ensure fiscal space. “This is a supply shock, not demand. Monitor inflation expectations and second-round effects before tightening; avoid choking growth unnecessarily,” the ADB chief economist added.

(Abu Tahar reported from Samarkand, Uzbekistan)