What If There Were No Wars At All?
A data-grounded reckoning with the world that never was — had Iran–Israel and Russia–Ukraine conflicts never erupted. Oil at $65. Defence budgets reclaimed. Half a trillion dollars building futures instead of rubble.
Reality (Apr 2026)
No-War Projection
2026 (GPI)
2026 (war vs peace)
Peace Scenario
Spend 2025
Cost
Iran Conflict
Imagining the Road Not Taken
The world of mid-2026 is defined by cascading crises that feed each other. The United States-Israel coalition has been at war with Iran since February 28, 2026. The Strait of Hormuz — through which roughly 20 million barrels of oil per day flow, representing approximately 27% of all global seaborne oil trade — has been functionally closed. The International Energy Agency has characterised what followed as "the largest supply disruption in the history of the global oil market." Meanwhile, Russia's full-scale invasion of Ukraine grinds into its fifth year, having already cost the country an estimated $588 billion in destruction — roughly three times its entire GDP.
But what if neither conflict had happened? What if diplomacy had prevailed in Tehran, and the ceasefire held in Kyiv? This article is a data-anchored thought experiment — drawing on verified projections from the IMF, World Bank, SIPRI, EBRD, IFPRI, CSIS, Capital Economics, Oxford Economics, IATA, and UN Tourism — to reconstruct the world that might have been.
The contrast, it turns out, is not merely staggering. According to the Global Peace Institute, the gap between a conflict scenario and a peaceful one amounts to approximately $2.2 trillion — a figure they call "the dollar value of diplomacy."
Oil, Gas & the Strait That Rewrote Everything
Before February 28, 2026, Brent crude traded at approximately $72 per barrel. By early March, it had surged past $106 — its largest weekly gain on record since 1983. By April, it had crossed $120. Goldman Sachs warned of a further rise above $100 if shipping disruptions continued. Capital Economics modelled a scenario in which prolonged conflict pushes Brent to $130 in Q2 2026, while some analysts placed the worst-case ceiling above $150.
In a peaceful world, Capital Economics' own projections place Brent at $65 per barrel by year-end. Qatar's LNG facilities — supplying 20% of the world's liquefied natural gas — would not have been struck by Iranian drones on March 2, 2026. QatarEnergy would not have declared force majeure. Dutch TTF benchmarks, which nearly doubled to over €60/MWh, would have remained at roughly €30–35/MWh. European gas storage — already critically low at 30% capacity following a harsh winter — would refill normally through summer.
Helium — of which Qatar produces approximately 40% of global supply — is an essential element in semiconductor manufacturing. It too has been stranded by the conflict. In a no-war world, chip supply chains would remain undisrupted, supporting the ongoing global technology boom that the IMF had identified as a key growth driver entering 2026.
"Just like the crisis after Russia's full-scale invasion of Ukraine. Different conflict. Same European divisions; same dilemmas over energy. We can't keep going round in these circles. Something's got to give."
— European MEP, quoted by BBC's Katya Adler, March 2026The $1.3 Trillion Question: What War Actually Costs the World
War Economy
- IMF global growth: 3.1% (reference scenario)
- Adverse scenario: 2.5% if Hormuz stays shut
- Severe scenario: 2.0% with inflation above 6%
- Global GDP loss: $1.3T (Scenario 2); $3.5T (Scenario 3)
- Global inflation: 4.4%–5.4%; disinflation derailed
- European gas up 63% in one week post-strikes
- Asian LNG up 54% week-on-week (Congress.gov)
- ECB warns Germany & Italy face technical recession 2026
- IMF MD warns of stagflation; bond sell-offs globally
- Egypt GDP under 4-channel stress simultaneously
Peace Economy
- Pre-war IMF forecast: 3.4% global growth — intact
- No scenario analysis needed; all projections on track
- Inflation continuing downward trend to target
- $2.2 trillion "value of diplomacy" preserved (GPI)
- European gas storage 80%+ by summer; no energy crisis
- Asian LNG at stable benchmarks; no emergency funds
- Ukraine GDP: 5.0% in 2026, 4.0% in 2027 (EBRD)
- Germany & Italy avoiding technical recession
- Fed rate-cutting cycle undisturbed; equities at all-time highs
- Egypt retaining $41.5B Gulf remittances intact
The IMF's April 2026 World Economic Outlook — titled "Global Economy in the Shadow of War" — is forensically clear. The pre-conflict global growth forecast stood at 3.4%. War immediately clipped it to 3.1% in the reference scenario, and as low as 2.0% in a severe scenario. The Global Peace Institute's modelling goes further: under its most likely near-term scenario, global GDP losses in 2026 total approximately $1.3 trillion, or 0.6% of world output. Should the conflict deepen, losses climb to $3.5 trillion — a figure that would exceed the entire economic shock of Russia's invasion of Ukraine in its first year.
The GPI's analysis adds something crucial: "What makes the 2026 shock distinctive is not its headline size but the way multiple disruption channels interact simultaneously." Energy, food, trade, remittances, and financial markets are all hit at once. Egypt — the world's largest wheat importer — is absorbing four simultaneous shocks: higher energy import costs, Suez Canal revenues down around 60% as ships reroute via the Cape of Good Hope, tourism earnings erosion, and lower Gulf remittances. Egypt alone received $41.5 billion in Gulf remittances in 2025 — equivalent to roughly 10% of its GDP. Within weeks of the conflict, foreign investors withdrew $6 billion from Egyptian markets, the pound fell over 8% against the dollar.
Ukraine's GDP was forecast at 5.0% growth in 2026 under a peace scenario, rising to 4.0% in 2027. The GPI calculates the gap between war and peace at $2.2 trillion — what they call "the dollar value of diplomacy." That sum is larger than the entire GDP of France.
From All-Time Highs to Wartime Sell-Offs: The Markets That Could Have Been
In the weeks before the Iran strikes, US and emerging market stocks had reached new all-time highs following ceasefire signals elsewhere. As U.S. Bank's chief equity strategist Terry Sandven noted: "Inflation is kryptonite to stock valuations. If energy prices rise and the price of other goods follow, higher borrowing costs could temper corporate earnings." That kryptonite arrived in March 2026.
Global stock markets declined as oil surged. A global bond sell-off materialised. Asian markets fell harder than the US, reflecting their greater exposure to the energy crisis. The IMF Managing Director warned policymakers at a March 9 symposium in Tokyo to brace for inflationary impact. The UK suffered the worst bond-market impact, signalling dangerous weakness in gilts.
Russian stocks moved counter-cyclically — trending upward, as Russia, a major non-Gulf hydrocarbon supplier, stood to benefit from higher energy prices. The ECB warned that Germany and Italy specifically could enter technical recession by end-2026. The eurozone as a whole faces potential growth reduction of 0.1% with inflation up 0.5%, per ECB analysis.
In a no-war world, the Federal Reserve's rate-cutting cycle would continue undisturbed. US Congressional approval of a $1 trillion+ defence budget for 2026 — including a $156 billion supplemental military boost — would, in a peaceful scenario, represent either unused capacity or funds redirectable to infrastructure and the green transition.
$2.887 Trillion Spent on War: What the World Could Have Built Instead
According to SIPRI's April 2026 release, world military expenditure reached $2.887 trillion in 2025 — the 11th consecutive year of real-terms increases, and the highest level since 2009 as a share of global GDP (2.5%). The top three spenders alone — the US, China, and Russia — spent a combined $1.48 trillion, accounting for 51% of the global total.
Europe's defence spending surged 14% to $864 billion in 2025 — the sharpest annual growth since the Cold War. Germany's budget grew 24% year-on-year to $114 billion, exceeding the 2% of GDP NATO threshold for the first time since 1990. Russia's defence burden reached 7.5% of GDP in 2025 — more than twice its pre-invasion level. Ukraine's military expenditure as a share of government spending hit its highest level ever recorded.
In a no-war world, these sums tell a different story. The UN Secretary-General António Guterres, launching a 2025 report on military spending, stated: "The evidence is clear: excessive military spending does not guarantee peace. It often undermines it — fueling arms races, deepening mistrust and diverting resources from the very foundations of stability." The UN's own projections found that global military spending, on current trajectories, will reach $6.6 trillion by 2035.
If the Russia-Ukraine war alone had not occurred, Europe's defence spending would not have surged by €100 billion above the previous year. Germany's €500 billion infrastructure fund — created specifically to bypass its debt brake for military spending — could have been redirected entirely toward green energy, rail networks, and digital infrastructure. The UK, instead of cutting development aid from 0.5% to 0.3% of GNI to fund defence, could have kept its commitments to the world's poorest nations.
Bread, Wheat & the 6-Month Lag That Will Still Be Felt
Ukraine and Russia together account for an outsized share of global food exports despite representing just around 2% of world GDP. Ukraine was expected to rank among the world's top three exporters of sunflower and rapeseed, the world's fourth-largest exporter of corn, and among the top six for wheat, barley, and soybeans in 2026 — according to the USDA. But its 2025 agricultural exports were already 35% below 2020 levels, the last pre-war harvest, per CSIS analysis.
The Iran conflict has compounded the agricultural crisis through a separate channel: fertiliser. Gulf states supply approximately 45% of global sulphur and 50% of global urea exports — both critical inputs to fertiliser production. Qatar alone produces around 40% of the world's helium. All are now stranded. The FAO estimates fertiliser prices could be an average 20% higher in H1 2026 if the crisis persists. The critical caveat, identified by IFPRI, is that this shock operates on a 6-to-9-month lag — meaning the full impact on food prices will not materialise until Q3–Q4 2026, after the South Asian and East African planting seasons.
"Food prices will definitely rise in the coming months, making it more difficult for many people around the world to afford adequate and healthy diets. Input shocks often transmit with a lag — this is a mixed signal, not a clear reason for reassurance."
— Sandro Steinbach, North Dakota State University, quoted by Al Jazeera, April 2026The only moderating factor, per Al Jazeera and the FAO, is that global cereal stocks are at record highs — 951.5 million tonnes projected by end of the 2026 farming season, up 9% year-on-year. In a no-war world, these record stocks would be a story of agricultural abundance. In the current reality, they are the only buffer between a fuel crisis and a food crisis.
For India — which accounts for roughly 25% of global rice exports and depends heavily on Gulf urea imports — a conflict-free 2026 means undisrupted fertiliser supply chains, stable petrol prices, and uninterrupted edible oil imports. Three separate channels of cost pressure would simply not exist.
307 Million Travellers — Redirected, Not Restored
In Q1 2026, 307 million tourists travelled internationally — about 6 million more than the same period in 2025, a modest 2% increase. Beneath this surface resilience, however, lies a dramatic geographic redistribution driven entirely by war. The Middle East, which had been the world's best-performing tourism region since the pandemic — with arrivals in 2025 standing 40% above 2019 levels — saw international arrivals crash 14% in Q1 2026.
Dubai International Airport, which celebrated a record 95.2 million passengers in 2025 and projected 99.5 million in 2026, has seen those forecasts shattered. Hamad International Airport in Doha, which handled 54.3 million travellers in 2025, faces deep uncertainty after QatarEnergy's force majeure declaration. Both airports were operating only for repatriation flights by early March 2026.
EUROCONTROL confirmed that more than 1,100 flights per day required rerouting due to closed or restricted airspace. Each rerouted flight burns more fuel, takes longer, and costs more to operate. Airlines including Lufthansa began preparing crisis plans including the potential grounding of aircraft due to jet fuel shortages. The WTTC, in a March 11 report, calculated the tourism sector's losses at $600 million per day.
IATA data showed global passenger demand rising 6.1% in February 2026 with load factors at a record 81.4%. UN Tourism had forecast 3–4% annual growth in international arrivals for 2026 before the conflict. The war has reduced that by 1–2 percentage points — representing 15–30 million fewer international trips and tens of billions in lost tourism revenue for developing economies that depend on it most.
The WTTC's $12 trillion valuation for the global tourism industry in 2026 — growing at 3.2%, outpacing broader economic growth — remains technically achievable in the data. It is simply unrealised in the world we have. In a peaceful scenario, China's outbound market — still methodically restoring international routes after the pandemic — would continue growing. Routes between Europe and Asia, which surged 14% in February alone, would have accelerated further through the year.
At the Petrol Pump, the Kitchen Table, and the Shop Floor
In the United States, the national average petrol price reached $3.41 per gallon by early March 2026 — rising by $0.43 in a single week. This was the largest weekly petrol price gain in recorded data dating back to 1983. Goldman Sachs warned of a further rise above $100/barrel if shipping disruptions continued. With oil at $65/barrel in a no-war scenario, US petrol would cost roughly $2.70–2.90 per gallon — saving the average American household hundreds of dollars annually.
In Vietnam, motorcyclists queued for hours at PV Oil petrol stations amid panic buying and acute shortages. Bangladesh entered recession-like conditions; universities closed early ahead of Eid to conserve electricity and fuel; shopping centres were ordered to shut by 8 PM. Pakistan faced simultaneous shocks from higher fuel costs, rising food prices, and Gulf remittance compression worth 4–5% of GDP. Pakistan, Egypt, and Kenya together face $5.1 billion in combined debt maturities in November and December 2026 alone — maturities that are becoming very difficult to roll over at manageable rates under Scenario 2, and effectively impossible under Scenario 3.
In Iran, food inflation surged to 105% by early 2026. Bread and cereals rose 140%. Red meat rose 135%. Oil and fats rose 219%. Fruits and nuts rose 104%. Dairy products climbed 116.8%. The Iranian central bank issued a ten-million-rial note — the largest ever denomination — as its currency collapsed. Sri Lanka's debt-to-GDP ratio is projected to approach 143% by 2028 under Scenario 3 — a level at which any IMF programme becomes unworkable without significant debt write-offs.
Russia's domestic population faces a different but structurally related crisis. Military spending reached 7.3% of GDP in 2025 — more than double its 2021 level. Unemployment sits at just above 2%, creating severe overheating; the Central Bank held interest rates at a peak of 21% to combat inflation. A peace economy for Russia would mean short-term recession risks as defence industries contracted — but non-military sectors, starved of investment since 2022, could begin recovery. The 25%+ collapse in oil and gas revenues under the current sanctions regime would also gradually ease under any normalisation.
For the average European family, a no-war 2026 means central banks completing their rate-cutting cycle rather than reversing course: lower mortgage rates, cheaper borrowing, and more disposable income rather than energy emergency payments. Germany's €500 billion infrastructure fund — created to bypass the constitutional debt brake specifically for military spending — could have funded rail modernisation, broadband expansion, and the energy transition instead.
Half a Trillion Dollars That Never Needed to Be Spent
Ukraine's estimated reconstruction cost, per the World Bank's February 2026 RDNA5 assessment, stands at $588 billion over the next decade — approximately three times Ukraine's entire nominal GDP for 2025. At least $20 billion in urgent early recovery spending has already been deployed since February 2022 in housing, energy, education, and transport. In 2026 alone, Ukraine has launched over $15 billion in public investment projects with the support of development partners, on top of $6.6 billion received under the ERA programme (financed from frozen Russian assets).
In a no-war world, this $588 billion does not evaporate — it simply never needs to exist. It could have financed decades of economic development: new manufacturing capacity, a green energy transition, digital infrastructure, and population recovery in a country that has lost millions to emigration and casualties. Ukraine's 12.9 million internally displaced and refugee citizens — one of Europe's largest displacement crises since World War II — would not exist.
The EBRD found that an early 2026 peace agreement would "substantially improve" Ukraine's outlook, delivering 5.0% GDP growth versus the current 2.5% war scenario. The EU's €90 billion loan, the €150 billion SAFE defence fund, and Germany's €500 billion infrastructure scheme — all created in response to war — represent a total reallocation of European capital away from productive investment and toward security. None of it would have been necessary in a peaceful Europe.
For Asia — China, India, Japan, South Korea — conflict-free energy markets mean strategic stability without improvisation. Japan, which relies on the Middle East for 90% of its crude oil imports, and South Korea, routing more than 95% of its Middle Eastern crude through the Strait of Hormuz, would not have activated South Korea's 100 trillion won ($68 billion) emergency market-stabilisation fund. India's three urea plants that curtailed production in response to the LNG shock would continue operating normally, supporting global rice production and food security.
The World That Numbers Describe, and Wars Deny
This is not a utopian fantasy. The verified data — from the IMF, the World Bank, SIPRI, EBRD, IFPRI, Capital Economics, Oxford Economics, IATA, UN Tourism, the Global Peace Institute, and CSIS — paints a coherent and concrete picture of what a conflict-free 2026 would look like.
Oil at $65 per barrel rather than $120. Global growth at 3.4% rather than 3.1% — or potentially 2.0% in a severe scenario. Between $1.3 trillion and $3.5 trillion in GDP not destroyed. Inflation continuing its downward trend rather than spiking to 4.4–6%. Ukraine growing at 5% rather than 2.5%. International tourism at 3–4% growth rather than 2%, with the Middle East's extraordinary recovery intact. Over 1,100 flights per day not requiring emergency rerouting. $600 million per day in tourism losses not accrued. European gas at half the price. Qatar's LNG facilities intact. Global military spending — at $2.887 trillion and rising — at least partly redirectable to what the UN calls "the very foundations of stability." The world's agricultural supply chains free of a 6–9 month fertiliser shock still working its way through the system.
The WEF's March 2026 analysis described the Iran conflict as "a structural shock to the world economy, delivered at a moment of geoeconomic fragility." The Global Peace Institute calculated that the difference between peace and war in 2026 is $2.2 trillion — "the dollar value of diplomacy." The Russia-Ukraine war delivered an earlier structural shock of comparable magnitude. Together, they represent a compound withdrawal from a future that data shows was entirely within reach.
None of this makes geopolitics simple. But the numbers have never been clearer about what is at stake when diplomacy fails. The alternative 2026 — stable energy, recovering economies, record tourism, rate cuts on schedule, $588 billion building futures rather than replacing rubble, nearly three trillion dollars a year not absorbed by militaries — was not a dream. It was a forecast. The difference between a forecast and a reality, it turns out, is whether we choose war.