{"id":3682,"date":"2026-04-09T07:59:31","date_gmt":"2026-04-09T06:59:31","guid":{"rendered":"https:\/\/blog.iese.edu\/expatriatus\/?p=3682"},"modified":"2026-04-09T07:59:31","modified_gmt":"2026-04-09T06:59:31","slug":"the-middle-east-crisis-and-the-future-of-global-work","status":"publish","type":"post","link":"https:\/\/blog.iese.edu\/expatriatus\/2026\/04\/09\/the-middle-east-crisis-and-the-future-of-global-work\/","title":{"rendered":"The Middle East Crisis and the Future of Global Work"},"content":{"rendered":"

\"\"<\/a>The world has rarely felt as volatile as it does right now. What began as a regional conflict has become, in the space of just a few months, one of the most consequential shocks to the global economy since the COVID-19 pandemic. The war in the Middle East, and the cascading disruptions it has unleashed, is not only a humanitarian tragedy. It is a stress test for global work as we know it.<\/p>\n

I have written before about how the economics of global work are shifting<\/a>, and how rising costs – from rerouted flights to prolonged visa delays – are making cross-border collaboration more expensive and time-consuming. I have also argued that collaborative global leadership is no longer optional in an age of disruption<\/a>. What the current crisis adds to both of these arguments is a sharper sense of urgency, and a genuine fork in the road.<\/p>\n

What Is Actually Happening<\/strong><\/p>\n

The numbers are striking. Around 20% of global oil and a similar share of LNG normally transit the Strait of Hormuz, a key shipping lane on Iran\u2019s southern border, and ship arrivals there have plummeted dramatically<\/a>. Brent crude prices jumped roughly 15% in the opening days of the conflict and then surged further as the market began pricing in the risk of sustained disruption. War-risk insurance has been cancelled or repriced, marine premiums have surged, and freight costs are rising across energy and non-energy trade alike, with ripple effects<\/a> stretching from semiconductor factories in Taiwan to farms in Brazil and steel mills in South Korea.<\/p>\n

The WTO<\/a> now warns that global merchandise trade volumes could grow by just 1.4% in a high energy price scenario in 2026, down from 4.6% growth in 2025, with services trade also decelerating. Container shipping delays have reached stress levels not seen since the immediate aftermath of the pandemic, with delays estimated at over 2 million Twenty\u2011Foot Equivalent Units as of early this year<\/a>.<\/p>\n

Beyond the physical flows of goods, the disruptions are hitting the infrastructure of global work itself. Air traffic disruptions around key Gulf hubs are affecting global tourism and adding further complexity to trade, while rerouting tankers and container ships raises freight and insurance costs and lengthens delivery times<\/a>. In my post on the economics of global work, I calculated that airspace rerouting around Russia alone was costing hundreds of thousands of Japanese business trips additional time each year. The Middle East crisis adds another layer: Gulf hub airports – many of them critical transit points for intercontinental travel – are operating at significantly reduced capacity.<\/p>\n

The question this raises for anyone leading or studying global work is not just \u201chow bad is it now?\u201d but \u201cwhere does this go?\u201d To address this question, let\u2019s engage in scenario thinking.<\/p>\n

Scenario 1: The Contraction – Global Work Retreats into Regions<\/strong><\/p>\n

In the first scenario, the conflict persists, energy prices remain elevated, and the cascade of disruption (to shipping, aviation, insurance, and investment) becomes normalized rather than resolved. Companies that have spent the past decade carefully constructing globally integrated operations begin to retrench.<\/p>\n

This is not far-fetched. Heightened risk perceptions<\/a> around critical maritime chokepoints have proven sufficient to disrupt oil and gas, shipping, insurance, and commodity markets, with downstream effects on food systems and manufacturing, and prolonged instability raises serious questions about capital allocation and long-term investment attractiveness in affected regions. Firms tend to respond rationally to such signals: they shorten supply chains, concentrate operations in politically safer corridors, and reduce the frequency of cross-border deployments.<\/p>\n

For global work specifically, the implications are significant. Expatriate assignments – already declining in number after the pandemic – become harder to justify when energy costs inflate relocation packages, visa delays disrupt planning timelines, and insurance premiums for working in or near conflict zones make the risk calculus unfavorable. The talent that once circulated freely across the Middle East\u2019s thriving business hubs – in Dubai, Riyadh, Doha – finds fewer reasons to go, or faces more obstacles in getting there.<\/p>\n

The broader shift from cost-driven globalization to geopolitically motivated \u201cfriendshoring\u201d and regionalization accelerates. Companies increasingly operate within defined geopolitical blocs rather than across them. Global virtual teams, which became even more prevalent during the pandemic, remain viable, but they substitute for rather than complement physical presence. The richness of on-the-ground cultural interactions, of the chance encounters in airport lounges and conference rooms that seed unexpected collaborations, diminishes.<\/p>\n

In this scenario, global work does not disappear, but it narrows. It becomes the preserve of the most resilient firms and the most experienced global professionals, who have built relationships deep enough to withstand disruption. For everyone else, the world gets smaller.<\/p>\n

Scenario 2: The Adaptation – Global Work Reinvents Itself<\/strong><\/p>\n

In the second scenario, the disruption acts not as a ceiling but as a catalyst. The crisis forces the kind of innovation and rethinking that comfort rarely produces.<\/p>\n

There are already signs of this. Regional economies are adapting swiftly; Saudi Arabia, for instance, has pivoted toward land-based oil export pipelines, while Dubai and Qatar have introduced emergency liquidity and business support packages to stabilize their economies<\/a>. Gulf states are leveraging their energy wealth to attract investment in AI and digital infrastructure, positioning themselves as hubs for the next economy even as regional conflicts persist.<\/p>\n

Meanwhile, at the end of January, India and the EU reached a landmark free trade deal, creating the world\u2019s largest free trade zone encompassing two billion people and nearly 25% of global GDP. This is a powerful reminder that geopolitical disruption in one part of the world can accelerate integration elsewhere. New trade corridors open and mew partnerships form. In this scenario global work does not shrink but simply reroutes.<\/p>\n

Technology plays a central role in this scenario. Global mobility becomes increasingly virtual<\/a>. AI tools fill the void when physical movement is constrained. Real-time translation, AI-augmented cross-cultural briefings, and virtual collaboration platforms become more central to cross-boundary collaboration; and they democratize global work, reducing the premium on physical presence and making it possible for professionals and firms that previously lacked the budget for frequent travel to participate meaningfully in international markets.<\/p>\n

The World Economic Forum\u2019s Global Value Chains Outlook 2026<\/a> found that nearly three in four business leaders now prioritize resilience investments, with 74% viewing resilience as a driver of growth rather than a cost, calling for a shift away from efficiency-driven supply chains towards \u201cadaptive networks.\u201d In other words, there is increasing pressure to build more flexible, redundant, and relationship-rich global networks.<\/p>\n

In this scenario, the global professionals who thrive are those who have invested in the kinds of deep, trust-based relationships that persist through disruption and that no rerouted flight path can sever.<\/p>\n

Which Scenario Will Prevail?<\/strong><\/p>\n

Probably neither, in its pure form. Reality, as always, will be messier. But the direction of travel matters enormously, and it is not predetermined. It will be shaped, in significant part, by how global leaders respond. Do they retreat into regional comfort zones, or do they invest in the relationships and capabilities that allow them to work across disrupted landscapes? Do they treat geopolitical risk as a reason to disengage, or as a prompt to become more sophisticated about where and how they engage?<\/p>\n

The answer cannot be to go it alone or to pull up the drawbridge. The challenges we are navigating, from energy security, to supply chain resilience and talent mobility, are precisely the kind that require coordination across borders, not withdrawal from them. The post\u2013Cold War phase of relative stability has given way to a more fragmented system, marked by weaker international coordination and intensified competition among major powers. But this makes the quality of global leadership more, not less, consequential.<\/p>\n

The cost of global work is rising. The cost of poor global leadership, or of abandoning global work altogether, is rising faster.<\/p>\n","protected":false},"excerpt":{"rendered":"

The world has rarely felt as volatile as it does right now. What began as a regional conflict has become, in the space of just a few months, one of the most consequential shocks to the global economy since the COVID-19 pandemic. The war in the Middle East, and the cascading disruptions it has unleashed, […]<\/p>\n","protected":false},"author":345,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18330],"tags":[25266,26749,102589,110661],"class_list":["post-3682","post","type-post","status-publish","format-standard","hentry","category-views-and-news-about-expatriates","tag-disruption","tag-geopolitics","tag-global-work","tag-virtual-global-mobility-vgm"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/posts\/3682","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/users\/345"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/comments?post=3682"}],"version-history":[{"count":1,"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/posts\/3682\/revisions"}],"predecessor-version":[{"id":3684,"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/posts\/3682\/revisions\/3684"}],"wp:attachment":[{"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/media?parent=3682"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/categories?post=3682"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.iese.edu\/expatriatus\/wp-json\/wp\/v2\/tags?post=3682"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}