World Bank Sees 23% Commodity Price Surge in 2026 as Middle East War, Supply Shocks Bite

Global commodity prices are set to surge 23% in 2026, the World Bank said on Wednesday, citing rising energy costs, disruptions to cargo shipping during the Middle East war, grain shipment problems in the Black Sea and high demand for safe-haven assets such as gold.

In its latest Commodity Markets Outlook, released Wednesday, the bank said oil, natural gas, food and metals prices all rose sharply this year as global shocks mounted. It warned the situation could worsen if the Middle East conflict ratcheted up and damage to Russian oil infrastructure continued.

**Energy at multi-year highs**

Global energy prices are projected to surge 32% in 2026, reversing three consecutive years of decline and reaching their highest level since Russia's 2022 invasion of Ukraine, the bank said. Brent crude is forecast to average $92 per barrel for the year, according to the report, with prices expected to remain elevated in the near term as oil output falls.

Global oil supply is expected to drop 5.2% in 2026, the biggest decline in four decades outside the 2020 global recession, the bank said. Global oil stocks have been depleted during the Middle East war, leaving the world more vulnerable to future supply shocks.

Prices would be even higher if oil demand were not forecast to drop 2.5% this year, the third-largest decline on record behind the 2020 COVID shock and the 1980 oil crisis. Despite the projected fall in consumption, the bank said oil production is expected to remain below demand, forcing further withdrawals from inventories.

**Food and fertilizer pressures**

Food commodity prices are set to rise just over 10% in 2026 due to grain shipment disruptions caused by hostilities between Russia and Ukraine in the Black Sea, and another 7%-plus in 2027, for a cumulative increase of nearly 18%, the bank said. It cited the threat of El Niño to agricultural harvests and higher fuel and fertilizer costs as additional pressures.

Fertilizer prices are expected to rise 14% in 2026 following a surge in urea prices, returning to 2025 levels in 2027.

The bank warned of a potential food crisis under an adverse scenario that couples a record El Niño — forecast to be the worst since 1950 — with more Black Sea grain shipment disruptions, escalation in the Middle East conflict and ongoing damage to Russian oil infrastructure. In that scenario, food prices could run 12% higher than expected, triggering a crisis like the one seen in the early 2010s, when more than 40 million additional people were pushed into extreme poverty.

**Metals and precious metals**

Metals prices are projected to rise 25% in 2026 and hit a new high, with aluminum, copper and tin all setting new records, the bank said. The increase reflects supply disruptions and strong demand from investments in renewable energy, electric vehicles and data centers. Metals prices are expected to decline 3% in 2027.

Precious metals prices are projected to surge 40% in 2026 amid elevated demand for safe-haven assets triggered by geopolitical and policy uncertainty, with some moderation seen in 2027, the bank said.

**Macro and policy implications**

Overall commodity prices are expected to ease by 7% next year, the bank said, but continued shocks could keep food prices elevated, raising the specter of higher inflation and tighter monetary policy.

"Commodity markets are being hit by several major shocks at once," said Ayhan Kose, the World Bank's deputy chief economist. "Higher energy costs and trade disruptions are driving up prices across a broad range of commodities, threatening to worsen inflation, food insecurity, and economic growth."

Kose said the World Bank was focused on protecting the world's poorest people and supporting low-income countries already grappling with heavy debt burdens.

The bank said it had already provided $8.7 billion in low-cost loans and other aid to 25 countries negatively affected by the war in the Middle East. That included 10 countries that retooled existing programs to cover crisis-related expenses and 19 that tapped new resources, with some using both.

Separately, Kose said the World Bank Group had made between $50 billion and $60 billion available through existing financing instruments, including $25 billion in pre-arranged financing, to help countries manage the effects of higher prices. He said the financing could support social safety nets for vulnerable populations, strengthen governments' fiscal capacity and provide working capital and liquidity support for businesses and farms.

The report was released two days before foreign ministers from the world's 20 largest economies are due to gather in Atlanta, Georgia for a meeting focused on the wars in the Middle East and Ukraine.