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The World Bank warns that global commodity prices are set to climb in 2026 to their highest level since 2022, when Russia’s full-scale invasion of Ukraine triggered a major shock to global energy markets. This time, according to the institution’s Commodity Markets Outlook cited by Bloomberg, the main driver is the war in Iran, which is disrupting global supply chains for oil, metals, and fertilizers.
Prices turning upward again
The World Bank’s aggregate commodity price index is projected to rise by around 16% in 2026, marking the first annual increase since 2022. Between 2023 and 2025, prices either declined or remained largely stable, but that trend is now reversing.
A key factor behind the shift is the closure of the Strait of Hormuz, which has significantly disrupted global energy flows following the escalation of conflict in early 2026. The World Bank describes this as a major shock to global commodity markets.
Oil, gas, and fertilizers under pressure
Oil:
The average price of Brent crude is now forecast at around $86 per barrel for 2026 — a sharp upward revision from the $60 estimate made earlier in the year.
Energy overall:
The energy price index is expected to rise by about 24%, reflecting tight supply conditions and ongoing geopolitical instability.
Natural gas:
Gas prices have surged due to disruptions in a region that plays a central role in global LNG exports.
Fertilizers:
Prices are projected to increase by roughly 31%, driven by higher costs of natural gas and oil, which are key inputs in production.
Inflationary ripple effects
World Bank Chief Economist Indermit Gill described the situation as a chain reaction: rising energy prices first push up transport and production costs, followed by food prices, and eventually broader inflation across economies.
This pattern closely mirrors the shock experienced in 2022 after Russia’s invasion of Ukraine, when global markets went through a similar cycle of energy inflation followed by food price spikes.
Food security risks
Rising fertilizer costs are particularly concerning for agriculture. Higher input prices reduce farmers’ margins and may threaten future harvests.
The World Bank warns that if oil prices remain above $100 per barrel, up to 45 million additional people could face acute food insecurity this year due to higher transport and production costs.
Who is most affected
According to the report, the poorest populations will bear the heaviest burden, as they spend the largest share of their income on food and fuel.
As Gill summarized, the broader economic impact is clear: “War is development in reverse.”
For countries like Ukraine, higher global energy prices translate into more expensive fuel and utilities, while rising fertilizer costs directly pressure the agricultural sector — one of the country’s key economic pillars.
