Energy prices expected to rise by 24% this year — World Bank forecast

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Energy prices are projected to surge by 24% in 2026, the largest jump since Russia's invasion of Ukraine in 2022, according to the World Bank Group's latest Commodity Markets Outlook, as reported by multiple outlets including Dawn, the Jerusalem Post, and TASS. The forecast, released this week, attributes the shock to ongoing conflict in the Middle East and disruptions in the Strait of Hormuz, a critical chokepoint for global oil shipments.

The report also projects overall commodity prices to rise 16% this year, driven by soaring energy and fertilizer costs and record-high prices for several key metals, as detailed in the World Bank's analysis cited by Dawn and the Jerusalem Post.

Coverage Comparison

Coverage of the report has been consistent across sources, though framing varies. Dawn, Pakistan's leading English-language daily, emphasized the global commodity market impact and cited the World Bank's warning that "the shock will have serious implications for job creation and development." The Jerusalem Post focused on the Iran conflict and its specific effects, including the closure of the Strait of Hormuz and the threat of food insecurity. TASS, the Russian state news agency, highlighted the "US and Israeli war with Iran" as a cause, while also reporting on additional IMF projections for oil prices under different scenarios.

All sources agree on the headline figures—24% energy price increase, 16% overall commodity price rise, and Brent crude averaging $86 per barrel in 2026—but differ somewhat on causal emphasis and additional context. TASS, for instance, notes the IMF's alternative scenarios that oil prices could reach $95–$115 per barrel if disruptions persist, a projection not mentioned in other available extracts.

Key Claims

The central claims from the World Bank report, as covered across sources, include:

• Energy prices: Projected to rise 24% in 2026, reaching the highest level since 2022, according to Dawn, the Jerusalem Post, and TASS.
• Brent crude: Forecast to average $86 per barrel in 2026, up sharply from $69 per barrel in 2025, as reported by Dawn and TASS.
• Commodity prices: Overall forecast to rise 16% in 2026, driven by energy and fertilizer costs, per multiple sources.
• Fertilizer prices: Projected to increase 31%, driven by a 60% jump in urea prices, as stated in Dawn and the Jerusalem Post. The Jerusalem Post adds that approximately half the world's urea supply and almost a third of ammonia typically flow through the Strait of Hormuz.
• Base metals: Prices for metals like aluminum, copper, and tin are expected to reach all-time highs, reflecting strong demand from data centres, electric vehicles, and renewable energy, according to Dawn's report.
• Precious metals: Prices forecast to increase 42% in 2026, as geopolitical uncertainty fuels demand for safe-haven assets, per Dawn.
• Inflation in developing economies: Projected to average 5.1% in 2026, a full percentage point higher than pre-war expectations and an increase from 4.7% last year, as reported by the Jerusalem Post.
• Food insecurity: The World Food Programme warned that prolonged conditions could push up to 45 million more people into acute food insecurity this year, according to the Jerusalem Post.

Perspectives

World Bank economists emphasize the cascading effects of the conflict. Chief Economist Indermit Gill, quoted by Dawn, said, "The war is hitting the global economy in cumulative waves: first through higher energy prices, then higher food prices, and finally, higher inflation, which will push up interest rates and make debt even more expensive. The poorest people, who spend the highest share of their income on food and fuels, will be hit the hardest." Deputy Chief Economist Ayhan Kose, as reported in Dawn's analysis, urged governments to resist "broad, untargeted fiscal support measures" that could distort markets and erode fiscal buffers.

United Nations agencies have echoed concerns about food supply. The Jerusalem Post reports that UN experts warned in mid-April that higher oil prices could incentivize farmers to divert maize, sugar, and oilseeds toward biofuel production, potentially reducing food supply. The World Food Programme's warning about 45 million people facing food insecurity is also noted.

IMF projections add a layer of uncertainty. TASS reports that the IMF's World Economic Outlook, published April 14, projects oil and gas prices could rise by 100% and 200% respectively in 2026–2027 if the conflict is prolonged. IMF Chief Economist Pierre-Olivier Gourinchas, as cited by TASS, acknowledged that the military operation could trigger "an energy crisis of an unprecedented scale."

Context and Caveats

The World Bank's forecasts assume that the most acute disruptions end in May and that shipping through the Strait of Hormuz gradually returns to pre-war levels by late 2026, as stated in the report and cited by Dawn and TASS. If disruptions are more prolonged or severe, TASS reports that Brent crude prices could range from $95 to $115 per barrel in 2026, a scenario not highlighted by other sources in their coverage.

The causal attribution to "US and Israeli war with Iran" is present in TASS's coverage, while Dawn and the Jerusalem Post refer more generally to "Middle East conflict" and "Iran conflict" respectively. This variation reflects different editorial perspectives rather than factual disagreement.

While the core projections are consistent across sources, the full range of the World Bank report's content—including detailed regional impacts and policy recommendations—may not be fully captured in available extracts. Readers are encouraged to consult the original report for comprehensive analysis.