World Bank Forecasts 24% Energy Price Surge in 2026

The World Bank's latest Commodity Markets Outlook, released on Tuesday, April 28, forecasts a 24 percent surge in global energy prices in 2026 due to disruptions from the war in Iran, marking the largest spike since Russia's 2022 invasion of Ukraine.

The report projects overall commodity prices to rise 16 percent next year, driven primarily by elevated energy and fertilizer costs amid attacks on energy infrastructure and shipping bottlenecks in the Strait of Hormuz. This vital waterway, which handles about 20 percent to 35 percent of global seaborne crude oil trade, has seen significant halts in traffic, resulting in the largest oil supply shock on record. Global production has fallen by more than 10 million barrels per day during the crisis, with Brent crude currently trading above $110 per barrel and West Texas Intermediate above $102.

Under the baseline scenario, Brent crude is expected to average $86 per barrel in 2026, up sharply from $69 in 2025. This assumes the most acute disruptions ease by May, with shipping volumes gradually returning to prewar levels by late in the year. However, if damage to critical oil and gas facilities worsens or export recoveries slow, prices...