World Bank Forecasts 23% Surge in Global Commodity Prices in 2026
Energy, metals and gold lead price increases as Middle East conflict disrupts shipping and oil supplies; El Niño could push food costs higher and deepen inflation risks.
Commodity Prices are expected to rise 23% globally in 2026, according to the World Bank
WASHINGTON: Global commodity prices are projected to rise 23% in 2026 as the Middle East conflict disrupts energy supplies and cargo shipping, while Black Sea grain shipment problems and demand for safe-haven assets add to market pressures, the World Bank said in its latest Commodity Markets Outlook.
The bank warned that further escalation in the Middle East and continued damage to Russian oil infrastructure could intensify the pressure on prices. It expects commodity prices to ease by 7% in 2027, but cautioned that weather-related disruptions and other supply shocks could keep food costs elevated.
The outlook raises concerns about inflation, food insecurity and slower economic growth, particularly in countries already facing financial and debt pressures.
Energy Prices Lead Commodity Surge
Global energy prices are projected to increase 32% in 2026, reaching their highest level since Russia’s invasion of Ukraine in 2022, according to the report.
Brent crude prices are expected to average $92 per barrel this year. The World Bank said oil prices would be even higher if demand were not forecast to fall by 2.5% in 2026.
Global oil supply is expected to decline by 5.2% this year. The bank described this as the largest drop in four decades outside the 2020 global recession.
The conflict has also depleted global oil inventories, leaving markets more vulnerable to further supply disruptions. Higher energy costs could feed into transport, manufacturing and food production expenses, putting additional pressure on consumers and businesses.
Metals and Gold Reach New Highs
The World Bank expects metals prices to rise 25% in 2026, setting a new annual high. Aluminium, copper and tin are projected to reach record levels amid supply disruptions and strong demand.
Investment in renewable energy, electric vehicles and data centres is contributing to demand for industrial metals.
Precious metals prices are forecast to increase 40% in 2026 as geopolitical tensions and policy uncertainty encourage investors to seek safe-haven assets such as gold. The bank expects some moderation in precious metals prices in 2027.
These increases could raise costs for industries that depend on metals, including construction, electronics, manufacturing and clean-energy infrastructure.
Food Prices Face El Niño Threat
Food commodity prices are expected to rise by slightly more than 10% in 2026. Disruptions to grain shipments linked to the Russia-Ukraine conflict in the Black Sea are contributing to the increase.
The report projects a further rise of more than 7% in 2027, taking the cumulative increase to nearly 18% over the two years.
The World Bank also warned that a severe El Niño weather pattern could worsen the outlook. Forecasts cited in the report point to the possibility of the strongest El Niño effects since 1950.
In an adverse scenario involving severe El Niño conditions, further Black Sea shipping disruptions, an escalation of the Middle East conflict and continued damage to Russian oil infrastructure, food prices could rise 12% above current expectations.
The bank cautioned that such an outcome could trigger a food crisis comparable to the one in the early 2010s. During that period, more than 40 million additional people were pushed into extreme poverty.
Fertiliser Costs Add to Agricultural Pressures
Fertiliser prices are projected to increase 14% in 2026, largely because of a surge in urea prices. The World Bank expects prices to return to 2025 levels in 2027.
Higher fertiliser and fuel costs could place additional pressure on farmers, particularly in countries that rely heavily on imported agricultural inputs. Rising production costs could also contribute to higher food prices.
For lower-income households, sustained increases in food and energy expenses could reduce purchasing power and make basic necessities less affordable.
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World Bank Warns of Inflation and Food Insecurity
“Commodity markets are being hit by several major shocks at once,” said Ayhan Kose, the World Bank’s deputy chief economist.
He said higher energy costs and trade disruptions were driving up prices across a broad range of commodities, threatening inflation, food security and economic growth.
Kose added that the bank was focused on protecting the world’s poorest people and supporting low-income countries already struggling with heavy debt burdens.
The report said the World Bank had provided $8.7 billion in low-cost loans and other assistance to 25 countries negatively affected by the Middle East conflict. Of these, 10 had adjusted existing programmes to cover crisis-related expenses, while 19 had accessed new resources. Some countries used both forms of support.
Global Economic Risks Remain Elevated
The World Bank released its twice-yearly report ahead of a meeting of foreign ministers from the Group of 20 major economies in Atlanta, Georgia, where the wars in the Middle East and Ukraine were expected to feature prominently.
The outlook highlights the vulnerability of the global economy to simultaneous supply shocks. Although the bank expects overall commodity prices to decline in 2027, further conflict, shipping disruptions and extreme weather could alter that trajectory.
For governments, businesses and consumers, the scale and duration of these pressures will influence inflation, production costs and the affordability of essential goods in the months ahead.
