The World Bank has projected that global commodity prices would decline to a five-year low in 2025 amid an oil glut that is so large that it could curtail the price effects of a wider conflict in the Middle East.
This is contained in a World Bank Group’s report titled: “World Bank 2024 Commodity Markets Outlook October 2024,” which projected that global commodity prices would fall by 5 per cent and 2 per cent in 2025 and 2026 respectively.
The report, which was released last weekend, stated: “Brent oil price is projected to average $80/b in 2024, about $3/b lower than last year, with prices expected to hover around $75 for the rest of the year before drifting lower to $73/b in 2025 and $72/b in 2026.
“This projection is predicated on no prolonged escalation in ongoing armed conflicts, a slowdown in oil demand growth, and a well-supplied oil market. Indeed, under these baseline assumptions, global oil supply next year is expected to exceed demand by an average of 1.2 million bpd—a degree of oversupply only surpassed during COVID-19-related shutdowns in 2020 and the 1998 oil price collapse.”
