WTO raises merchandise trade growth forecast to 3.9% as AI boom offsets hit from Middle East

GENEVA (AP) — The World Trade Organization is dramatically raising its forecast for worldwide merchandise trade growth this year, more than doubling its previous prediction to 3.9% as AI investments offset losses from the war in the Middle East.

The Geneva-based trade body says global trade expanded at a robust pace, with supply chains adapting and AI-related spending fueling a "powerful boost to goods trade." The revised forecast represents a significant increase from an initial WTO prediction of 1.9% growth in merchandise trade for this year, which excludes services trade.

WTO attributed the growth to global supply chains adapting to disruptions in energy and fertilizer markets, alongside robust investment in AI infrastructure boosting trade in AI-enabling goods. Oil, gas, and fertilizer shipments through the Persian Gulf were severely impacted by the recent U.S.-Israeli conflict with Iran, which began in February. Nonetheless, shipments from alternative suppliers helped limit the decline to around 1% for liquefied natural gas and about 6% for crude oil.

The trade organization anticipates global GDP growth of 2.6% in 2026 and 2.9% in 2027, despite expecting the Middle East conflict to continue weighing on trade through higher energy prices and disruptions to transport routes.