Washington City, April 29, 2025. According to the latest edition of the report Commodity Markets Outlook (Perspectives of the Basic Products Markets) of the World Bank, the wobbly economic growth coincides with a wide range of oil, which can make the international prices of basic products fall at its lowest level so far in the decade of 2020. This decrease could help moderate the short -term inflation risks derived from the increase in commercial barriers, but it could also impede the perspectives of economic progress in two of each developing economies.
International prices of basic products are expected to fall 12 % in 2025 and an additional 5 % in 2026, to levels that were not registered from 2020. In nominal terms, prices could continue to be higher than before the start of the pandemic. However, if they are adjusted for inflation, they are likely to fall below the preponderant average between 2015 and 2019. That would mark the end of a period of boom driven by the rebound of the world economy after the Covid-19 pandemic and the invasion of Russia to Ukraine of 2022.
The weakening of growth prospects constitutes the most recent shock that hits the world economy in what seems to be an extraordinarily agitated decade for basic products markets. The volatility of the prices of this segment has been greater than in any previous decade since, at least, that of 1970. It remains to see if this will mark the beginning of a more turbulent era for basic products markets. In any case, the confluence of commercial tensions, conflicts, geopolitical risks and frequent disturbances related to climate increase the chances of this being so.
“The rise in the prices of basic products has been a blessing for many developing economies, two thirds of which are exporters of these products,” he said Indermit Gill, Chief Economist and Senior Vice President of Development Economics of the World Bank Group. “But now we are facing the stage of greater volatility of prices of the last 50 years or more. The combination of high pricing volatility and low price level generates problems. Developing economies must take three measures to protect themselves: first, restore fiscal discipline; second, create a more favorable environment for companies, in order to attract private capital; third, liberalize trade whenever there is opportunity”
The international prices of basic products have been falling since 2023, which has helped contain general inflation worldwide. For example, the increase in energy prices added more than 2 percentage points to world inflation in 2022. However, in 2023 and 2024, the decrease in those same prices helped reduce inflation. This downward trend is expected to intensify this year, which could mitigate some of the effects of the increase in rates on the prices of the main economies. Energy prices are expected to decrease 17 % this year until reaching the lowest level of the last five years, and that they fall an additional 6 % in 2026. According to estimates, the prices of the variety of crude oil will average a value of just USD 64 the barrel in 2025 – a decrease in USD 17 compared to 2024— and only USD 60 in 2026. On the other hand, it is believed that coal prices will fall 27 % this year and an additional 5 % in 2026, as the growth of the consumption of this product for the generation of energy in development economies will slow down.
This perspective reflects expectations of more weak economic growth, as well as a long -term deceleration of world oil demand. It is expected that in 2025 the world oil supply will exceed the demand in 0.7 million barrels per day. The rapid adoption of electric vehicles has also reduced oil demand: in China, the world’s largest automotive market, more than 40 % of new cars that were bought last year were hybrid vehicles or that worked with batteries. This figure is almost three times higher than that of 2021.
On the other hand, food prices will fall, according to forecasts, 7 % in 2025 and 1 % in 2026. Even so, the United Nations estimate that this year will intensify acute food insecurity in some of the most affected areas in the world, which will affect 170 million people from 22 highly vulnerable economies. The fall in basic food prices should provide some relief to humanitarian efforts, particularly in a context of financing reduction for this type of activities. Anyway, it will not solve the underlying causes of acute hunger, which largely have their origin in conflicts.
The average price of gold is expected – a popular option among investors looking for a “safe refuge” – reaching a record value this year and then stabilizes in 2026. Gold occupies a special category among the assets, since it often rises in price during periods of geopolitical uncertainty and regulations, such as conflicts. It is expected that, in the next two years, its prices will be maintained approximately 150 % above the average of the five years prior to the Covid-19 pandemic. On the other hand, the price of industrial metals is expected to fall in 2025-26, as demand falls as a consequence of the growing commercial tensions and the low activity that continues to be observed in the real estate sector of China.
In oneSpecial sectionThe report indicates that the boom and fall cycles of the prices of the basic products became particularly intense in the 2020s. These marked cycles can negatively influence both the fiscal discipline and in the long -term economic growth of these economies. Since 1970, the average duration of these cycles had been about four years, and the crisis periods extended a little more than those of boom, according to the analysis. However, between 2020 and 2024, the duration of these deadlines has been reduced by half.
“The prices of the basic products have fluctuated throughout the 2020s: they collapsed with the arrival of the Covid-19 pandemic, then they reached historical maximums after the Russian invasion of Ukraine and then fall again,” he saidAyhan Kose, deputy chief economist and director of the World Bank Perspectives Group. “In an era of geopolitical tensions, increases in demand for critical importance and most frequent natural disasters, this could become the new normality. To pierce the successive oscillations of the prices of basic products, development economies must generate fiscal space, strengthen their institutions and improve the climate for investment with the aim of facilitating job creation.”