The World Bank Group predicts a significant increase in global commodity prices in 2026. Prices are expected to rise to their highest level in the last four years, due to substantial disruptions in the supply of oil and metals caused by the war in Iran.
This is reported by Finway
Impact of the Conflict on the Energy Sector and the Global Economy
According to forecasts, the World Bank’s commodity price index will increase by approximately 16% this year. This jump will mark the first annual increase since Russia’s invasion of Ukraine, which then caused significant upheaval in energy markets and rising global inflation.
The energy sector has been particularly hard hit: prices for energy carriers and fertilizers have reached multi-year highs. This is due to the closure of the Strait of Hormuz, through which about one-third of global maritime oil trade passed before the war began. This has caused an unprecedented shock in energy and commodity markets.
“The war impacts the global economy in waves: first through rising energy prices, then through increasing food prices, and finally through rising inflation,” explained World Bank Chief Economist Indermit Gill.
Forecasts for Oil, Fertilizer, and Food Prices
The World Bank’s baseline scenario anticipates that the most acute supply disruptions will end in May this year. Based on this, the World Bank’s energy price index is expected to rise by approximately 24%. The average price of a barrel of Brent crude oil is projected to be $86 – significantly higher than the January estimate of $60 per barrel.
Additionally, natural gas and fertilizers have become significantly more expensive due to the conflict. Fertilizer prices are expected to rise by 31% in 2026, creating additional risks for farmers’ incomes and yields. Such an increase in fertilizer costs could lead to higher food prices and exacerbate food instability.
The World Bank warns that if oil prices remain above $100 per barrel, an additional 45 million people could face acute food instability this year.