The outlook has darkened dramatically since last year's summit in Germany, when the leaders declared the global economy was in "good condition" and oil cost $70 a barrel - which seemed high at the time.
Since then, the U.S. subprime mortgage crisis has erupted, roiling markets and battering financial firms. Oil has doubled to above $140 and food prices have jumped, hurting the poor in particular and raising the threat of political instability.
"Things have changed for the worse across the board," said Robert Hormats, vice chairman at Goldman Sachs (International) Corp. in New York.
Hormats argues that the economic problems now are more serious and widespread than during the Asian financial crisis of 1997-98, where the pain was largely limited to emerging markets.
"Now you have a financial disorder where the epicenter is the U.S.," he said. And fuel and food inflation "are serious matters that affect large numbers of people."
Host Japan had put global warming at the top of the summit's agenda, but the dilemma of how to respond to accelerating inflation and slowing global economic growth could grab the spotlight.
Prime Minister Yasuo Fukuda has said he hopes the July 7-9 meeting at a hot springs resort in Hokkaido, Japan's northern island, will "show some direction" in tackling oil and food prices but stressed it was only "one step" in a longer process.
On oil, analysts are skeptical that the G-8 leaders - representing the U.S., Japan, Britain, France, Germany, Russia, Italy and Canada - will come up with much beyond urging major petroleum producers to boost output, reiterating the message of their finance ministers, who met last month in Osaka.
Foreshadowing possible disagreement among the leaders, the finance ministers were divided on where to assign blame for the run-up in oil prices. Germany, France and Italy held speculators largely accountable, while the U.S. and Britain said the focus needed to be on boosting production capacity that has barely kept up with growing global demand.
Soaring crude prices have already forced India, Malaysia, and Indonesia to cut subsidies and raise state-set prices on gasoline and other fuels. Last month, China hiked fuel prices as much as 18 percent.
At the same time, prices of corn, wheat, rice and soybeans and other farm goods have surged due to changing diets, urbanization, expanding populations, extreme weather, growth in biofuel production and speculation.
Spiraling fuel and food costs could drive millions into poverty, the Asian Development Bank has warned. In India, inflation has jumped to a 13-year high of 11.4 percent.
On the food front, the G-8 leaders may announce an aid package or pledging agricultural investment in poorer countries, experts say.
The credit crisis and global market turmoil are sure to be discussed, but with central bankers absent the leaders will most likely avoid saying anything specific about interest rates and currencies. The European Central Bank raised its benchmark interest rate a quarter point Thursday, suggesting it saw inflation as a greater threat than slower growth.
Overall, the summit's main goal will be demonstrating confidence that they can "work through the oil crisis without causing the global economy to melt down," said Tom Cooley, dean of New York University's Stern School of Business.
Given the meeting's emphasis on climate change, the leaders could highlight the links between energy issues and global warming by stressing the importance of energy efficiency and alternative forms of energy, said Goldman's Hormats.
"The key thing is not what they do at these meetings but what they do at home," he said.
Oil and energy have remained recurring themes at the annual summits, said Hormats, who participated in several of the first meetings, which started in 1975. That initial gathering came after the 1973-74 oil embargo, when fuel prices surged after Middle East oil producers cut off the U.S. and other countries supporting Israel.
"We now have another oil crisis," Hormats said.
The summits were originally meant to focus on economic issues, but the agenda has expanded to include terrorism, Africa's development and the environment.
The group's membership also has grown from six to eight, adding Russia in 1997.
But many argue that it should be expanded to include China, the world's fourth-largest economy, and other emerging powerhouses like India and Brazil - especially to tackle global issues like energy and climate change.
"At what point will the G-8 realize we're no longer the steering committee for the world economy?" said Lael Brainard, a former deputy national economic adviser in the Clinton administration who attended several summits in the 1990s and now is a director at the Brookings Institution, a Washington think tank.
Already, the G-8 has been reaching out. It plans meetings with African leaders on the summit's first day, and later with leaders from China, India, Mexico, Brazil and South Africa - countries that someday might be a part of the Group of 13.
"These countries are critical to the solution of any of these problems," said Brainard. "I believe it's only a matter of time" until the club expands.