World Bank sees commodity prices surge in 2026 amid Middle East war shocks

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World Bank commodity price surge 2026

Highlights

World Bank projects global energy prices to surge 32% in 2026, with Brent crude averaging $92 per barrel and oil supply falling 5.2%.
Food commodity prices are forecast to rise over 10% in 2026 and over 7% in 2027 due to Black Sea disruptions, while fertilizer prices climb 14% in 2026.
Metals prices are expected to rise 25% and precious metals 40% in 2026, driven by supply shocks and safe-haven investment amid geopolitical uncertainty.

Commodity outlook points to broad-based price pressure

As reported by Reuters, citing the World Bank in its latest Commodity Markets Outlook, oil, natural gas, food and metals prices all rise sharply this year as overlapping shocks hit global supply chains and trade flows. The bank says the situation could worsen if the war in the Middle East escalates further and damage to Russian oil infrastructure continues.

The report says global energy prices surge 32% in 2026, reaching their highest level since Russia's 2022 invasion of Ukraine. With oil output down, Brent crude is expected to average $92 per barrel for the year, while global oil supply is projected to fall 5.2% in 2026, the biggest decline in four decades outside the 2020 global recession.

The World Bank says food commodity prices are set to rise just over 10% in 2026 because of Black Sea grain shipment disruptions tied to hostilities between Russia and Ukraine, followed by another increase of more than 7% in 2027. Fertilizer prices are expected to climb 14% in 2026 on higher urea prices, before returning to 2025 levels in 2027.

Metals prices are projected to rise 25% and reach a new high in 2026, with aluminum, copper and tin all setting records because of supply disruptions and strong demand from renewable energy, electric vehicles and data centers. Precious metals prices are projected to surge 40% in 2026 as investors seek safe-haven assets amid geopolitical and policy uncertainty.

Inflation and food security risks remain in focus

Commodity prices are expected to ease by 7% next year, but the bank says continued shocks could keep food costs elevated and raise the prospect of tighter monetary policy. It also warns that forecasts for the worst El Niño weather effect since 1950 could add further pressure to agricultural markets.

Ayhan Kose, the World Bank's deputy chief economist, says commodity markets are being hit by several major shocks at once, with higher energy costs and trade disruptions lifting prices across a broad range of goods. He says that dynamic threatens to worsen inflation, food insecurity and economic growth, especially in vulnerable economies.

The report says an adverse scenario combining a record El Niño, deeper Black Sea shipping disruptions, further escalation in the Middle East conflict and ongoing damage to Russian oil infrastructure could push food prices 12% above current expectations. The bank says such an outcome could trigger a food crisis similar to the early 2010s, when more than 40 million additional people were pushed into extreme poverty.

The World Bank says it has already provided $8.7 billion in low-cost loans and other aid to 25 countries negatively affected by the war in the Middle East. The release comes two days before foreign ministers from the Group of 20 economies gather in Atlanta, where the wars in the Middle East and Ukraine are due to dominate discussions.

In our earlier article on the WTO warning of lasting trade fallout from the wars in Ukraine and the Middle East, we explained how companies are redesigning supply chains and shipping routes to reduce exposure to repeated shocks. The WTO highlighted a sharp contraction in Middle East trade and argued that diversification toward costlier but more resilient alternatives could persist even after conflicts ease, alongside a shift toward more regionalized trade patterns.

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