Global commodity prices are projected to increase by 23% in 2026, driven largely by rising energy costs and disruptions linked to the ongoing conflict in the Middle East, according to the World Bank’s latest Commodity Markets Outlook released Wednesday. The report highlights additional pressures from Black Sea grain shipment interruptions and heightened demand for safe-haven assets such as gold.
The World Bank attributes the surge in prices this year across oil, natural gas, food, and metals markets to a convergence of global shocks. These include hostilities in the Middle East impacting cargo routes, continued damage to Russian oil infrastructure, and a tightening supply situation. The report warns that unless the Middle East conflict subsides and infrastructure constraints ease, the upward pressure on commodity prices may intensify.
Energy prices are expected to rise 32% in 2026, reaching levels not seen since Russia’s invasion of Ukraine in 2022. Brent crude oil prices are forecast to average $92 per barrel next year, supported by a 5.2% decline in global oil supply—the largest drop outside the 2020 recession in four decades. This decline is compounded by depleted global oil stockpiles and a projected 2.5% drop in oil demand this year, which has helped moderate prices.
Food commodity costs are anticipated to increase by over 10% in 2026, primarily due to ongoing grain shipment challenges in the Black Sea region amid the Russia-Ukraine conflict. Prices could climb an additional 7% in 2027, for an overall rise of nearly 18%. The report outlines a possible adverse scenario involving a record El Niño weather event, escalated Middle East hostilities, and further damage to Russian oil infrastructure, which could push food prices 12% above current expectations. Such an outcome raises the risk of a food crisis reminiscent of the early 2010s, when millions were driven into extreme poverty.
Fertilizer prices are also expected to increase by 14% in 2026, largely fueled by surging urea costs, before returning to previous levels in 2027. Meanwhile, metals markets show significant price gains, projected to rise 25% and reach new highs next year. Supply disruptions and strong demand related to renewable energy investments, electric vehicles, and data center expansion are cited as key factors behind record prices for aluminum, copper, and tin.
The World Bank’s deputy chief economist, Ayhan Kose, emphasized the multifaceted nature of current commodity market shocks and the risks they pose to inflation, food security, and economic growth. The bank is focused on supporting low-income countries grappling with high debt and the fallout from these crises. To date, the institution has extended $87.7 billion in financial assistance to 25 nations affected by the Middle East conflict, including new and adjusted aid programs addressing crisis-related needs.
The report arrives shortly before the G20 foreign ministers’ meeting in Atlanta, Georgia, where discussions are expected to focus on the geopolitical conflicts affecting global markets, including those in the Middle East and Ukraine. The continuing volatility underscores the global economy’s vulnerability to supply disruptions and the potential for prolonged inflationary pressures.