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Commodity prices are projected to decline in 2025, driven by improved supplies, policy uncertainty, and an expected slowdown in global economic growth. Energy prices are expected to see the steepest drop, with the World Bank’s energy price index forecast to fall by 17 percent in 2025 and an additional 6 percent in 2026. Following a modest 2.5 percent increase in 2024, metals and mineral prices are expected to ease slightly over 2025-26. Agricultural prices are also projected to decline gradually—by 1 percent in 2025 and 3 percent in 2026.
Commodity prices fell sharply in March and April, reversing earlier gains. After rising 2 percent in the first quarter of 2025 (q/q), prices dropped nearly 6 percent in April (m/m), with broad-based declines across most categories—except for fertilizers and precious metals. The sharp decline reflects mounting concerns about the global economic outlook amid escalating trade tensions. Energy prices fell 8 percent, led by steep declines in oil and natural gas. Metal prices declined 7 percent, weighed down by widespread losses in industrial metals. Agricultural prices edged down 1 percent, as falling food prices more than offset gains in some beverage commodities.
Brent crude oil prices fell to $60/bbl in early May—a four-year low—driven by mounting concerns about weakening demand and rising supply. Between April 2 and April 8 alone, prices dropped by $12/bbl, as fears over escalating trade tensions coincided with a larger-than-expected increase in OPEC+ production. Global oil supply is projected to rise by 1.2 mb/d in 2025, outpacing the 0.7 mb/d increase in demand, according to the International Energy Agency. Brent crude is forecast to average $64/bbl in 2025, down sharply from $81/bbl in 2024, and to decline further to $60/bbl in 2026. Risks to the outlook remain tilted to the downside, particularly if global growth slows further or OPEC+ increases production beyond currently announced levels.
Natural gas prices tumbled in April, though the outlook remains mixed. The World Bank’s natural gas price index fell 14 percent in April 2025 (m/m), following the announcement of major tariffs, after surging 24 percent in the first quarter. The decline was led by the U.S. benchmark (-17 percent), followed by Europe (-12 percent), and Japan LNG (-1 percent). Despite the recent drop, the index is expected to be higher in 2025 and remain broadly stable in 2026. The U.S. benchmark is forecast to jump more than 50 percent in 2025 amid low inventories and strong demand, before rising modestly in 2026. Europe’s benchmark is projected to climb 6 percent this year, supported by storage rebuilding, but fall 9 percent in 2026 as LNG supply expands and demand softens. Risks to the forecast are titled to the downside, with slower global growth and rising supply likely to weigh on prices—though upside risks remain if inventory restocking accelerates, or winter temperatures are lower than expected.
Agricultural prices dip amid improved supplies and trade tensions. Following a 2 percent increase in 2025Q1, agricultural prices edged down in April 2025 (m/m), amid improved supplies and rising trade tensions. Food commodity prices fell 2 percent in 2025Q1 and continued to ease in April, supported by favorable weather in South America and persistent concerns about global demand. The World Bank’s food price index is projected to decline by 7 percent in 2025 and edge lower in 2026, driven by ample grain supplies and the easing of rice export restrictions from India. In contrast, beverage prices surged16 percent in 2025Q1, led by record highs in cocoa and coffee due to weather disruptions. The beverage price index is expected to rise nearly 20 percent in 2025, before falling 11 percent in 2026 as production recovers. Raw material prices, which have remained relatively stable in recent quarters, are forecast to decline through 2025 and stabilize in 2026, with slower global growth posing a key downside risk.
Food insecurity persists despite easing prices. While food prices are projected to decline in 2025–26, the drop is unlikely to significantly reduce acute food insecurity. Ongoing conflict in fragile states and shrinking global humanitarian aid may offset the benefits of lower prices. According to the UN Food and Agriculture Organization, approximately 170 million people across 22 countries have faced worsening acute hunger between November 2024 and May 2025—three-quarters of them concentrated in just eight countries, where conflict remains the main driver. Acute food insecurity is most widespread in Nigeria, Sudan, Ethiopia, Myanmar, the Syrian Arab Republic, and the Republic of Yemen.
Metal prices slide as demand outlook weakens. Metal prices fell 7 percent in April (m/m) following a modest rise in 2025Q1, as escalating trade tensions and new tariffs sharply dampened demand—particularly for metals used in autos and electronics. Continued weakness in China’s property sector added further pressure, weighing on demand for metals such as iron ore and zinc despite government stimulus efforts. However, the ongoing energy transition, especially in China, is expected to support demand for metals such as copper and nickel. After rising 3 percent in 2024, the World Bank’s metals and minerals price index is projected to fall by 10 percent in 2025 and a further 3 percent in 2026 amid slowing global growth.
Gold prices hit a record high amid global uncertainty. Gold prices exceeded US$ 3,200/toz in April—a record high—driven by strong safe-haven demand amid rising policy uncertainty, escalating trade tensions, and a shift away from other traditional safe assets. Central bank purchases also contributed to the rally, reflecting broader reserve diversification strategies. Gold prices are projected to remain more than 150 percent above their 2015–19 average through 2025 and 2026, supported by persistent geopolitical risks, financial market volatility, and continued accumulation by central banks.
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