World Bank projects 23% rise in global commodity prices in 2026

A commodity is a widely traded basic good, such as oil, grain or copper. The World Bank projects that prices across these markets will rise 23% in 2026. This matters because commodities feed into transport, electricity, farming, manufacturing and household food costs.

The forecast includes energy products such as crude oil, food commodities such as grains, industrial metals such as aluminium and copper, fertiliser and precious metals. Energy prices are projected to rise 32%, while food prices could increase about 10%.

Metal prices are expected to climb 25%, fertiliser prices 14% and precious metals 40%. Overall commodity prices are then projected to fall 7% in 2027, assuming conflicts do not further disrupt supplies. The outlook could worsen if the Middle East conflict escalates or Russia’s oil infrastructure remains damaged.

A commodity is a basic raw material or agricultural product that can be bought and sold in markets. Its price is shaped mainly by global supply and demand. Commodities matter because businesses and households use them directly or rely on them to make other products.

Energy commodities include oil and other fuels used for transport, electricity and industry. Food commodities include grains and other farm products. Industrial metals, including aluminium, copper and tin, support construction, manufacturing, electric vehicles and data centres.

Precious metals are a separate group because investors often buy them as safe-haven assets during uncertainty. The article projects 2026 price increases of 32% for energy, about 10% for food, 25% for metals and 40% for precious metals. Fertiliser is also tracked because it affects agricultural production, with prices forecast to rise 14%.

The World Bank expects the main commodity groups to rise sharply in 2026. Energy prices are projected to increase 32%, reversing three consecutive years of decline. Brent crude is expected to average 91 dollars per barrel, compared with 69 dollars in 2025.

Food commodity prices are expected to rise about 10%. Metal prices are projected to increase 25%, with aluminium, copper and tin reaching record highs. Fertiliser prices are forecast to climb 14%, following an early-year surge in urea prices.

Precious metals have the largest projected increase, at 40%, as demand for safe-haven assets remains high. Food prices could rise another 7% in 2027, producing an 18% cumulative increase. By contrast, metal prices are expected to fall 3% and fertiliser prices return to 2025 levels in 2027.

Commodity prices rise when supply is threatened or demand remains strong. Middle East conflict can disrupt energy flows and trade routes, while declining oil inventories leave less stock available to absorb a sudden shortfall. Markets then price in greater scarcity and risk.

The report links higher food prices to grain-shipment disruptions caused by the conflict, a possible El Niño threat to harvests, and higher fuel and fertiliser costs. Farmers face more expensive inputs, while damaged or delayed shipping reduces the amount reaching buyers.

These pressures can reinforce one another. Higher fuel costs raise transport and farming expenses. Higher fertiliser prices can limit production or increase food prices. The World Bank also warns that attacks on Black Sea grain shipments, a strong El Niño and continued damage to Russia’s oil infrastructure could make the outlook substantially worse.

Energy and food are essential costs, so price increases spread through economies. More expensive fuel raises transport, electricity and production expenses. More expensive food reduces what households can afford and can push inflation higher, especially in vulnerable countries.

The World Bank warns that the effects could include worsening food insecurity and weaker economic growth. Poor households spend a larger share of their resources on essentials, leaving less for healthcare, education and other needs. Governments may also face pressure to protect consumers while managing heavy debt burdens.

The most severe outcome would come if several risks materialised together. The report says higher energy prices, Black Sea grain attacks and a strong El Niño could trigger a food crisis and push more people into extreme poverty. The World Bank proposes social safety nets and financing support for affected countries, businesses and farms.

Oil prices depend on the balance between available supply and demand, not on demand alone. In 2026, global oil supply is projected to fall 5.2%, while consumption is expected to decline 2.5%. Because supply falls more sharply, the market can still face a shortage.

The report says production is expected to remain below demand despite lower consumption. Buyers would therefore draw oil from inventories, or stored reserves, to fill the gap. As those stocks shrink, less oil remains available if another disruption occurs.

That reduced buffer can lift prices because traders anticipate tighter future supplies. The World Bank projects Brent crude will average 91 dollars per barrel in 2026, up from 69 dollars in 2025. Electrification is reducing consumption, particularly in China, but supply shortages and inventory withdrawals still leave global markets exposed.

Global commodity markets connect producers, traders, transport routes and consumers across borders. A disruption in one region can reduce the supply available to the wider market. Prices then adjust internationally, even for countries far from the original conflict.

For example, attacks on grain shipments can delay or prevent food from reaching global buyers. Damage to oil infrastructure can reduce exports and force other countries to compete for replacement supplies. Falling inventories make the oil market especially sensitive because stored supplies provide less protection.

The higher prices spread through the economy. More expensive oil raises transport and production costs, while reduced grain availability raises food prices. The World Bank warns that Middle East escalation, Black Sea attacks or persistent damage to Russia’s oil infrastructure could worsen the outlook. In an adverse scenario, Brent could average 105 dollars per barrel in 2027.