The world Bank cut its forecast for oil to $37 per barrel in 2016

The world Bank cut its forecast for oil to $37 per barrel in 2016

Moscow. January 26. The world Bank (WB) has lowered its price forecasts for oil, base metals and agricultural products in 2016, a total of lower revised estimates for 37 of the 46 commodities, said in a quarterly report Commodity Markets Outlook.

Now analysts expect that oil (the basket of Brent, Dubai and WTI with equal weight) in the current year will average $37 per barrel, not $52 per barrel, as predicted in October. The revision reflects a number of factors of supply and demand, including more rapid resumption of oil exports by Iran after the lifting of international sanctions, the WB than previously thought, a mild winter in the Northern hemisphere, as well as the worsening prospects of economic growth in major developing countries.

In 2015 oil basket tracked by the WB, fell 47%, in 2016 is expected to fall another 27%, however, by the end of the year the prices will grow slightly from the current very low level, including through gradual alignment of supply and demand.

In the future the recovery in oil prices will be less than landslides after 1986, 1998 and 2008.

“Low commodity prices – a double edged sword: consumers in importing countries benefit from them, while producers in exporting countries suffer, – said the Director of group development prospects, world Bank Ayhan Kose. – To convert the benefits from lower raw materials prices in the strengthening of economic growth in importing countries will take time, while commodity exporters are feeling the negative effects now.”

Energy in General will probably fall this year 25% compared to the year 2015.

The prices of raw materials excluding energy in 2016 is expected to decrease by 3.7%, including the metals will drop by 10% after the collapse of 21% in 2015. The cost of agricultural products is expected to decrease by 1.4%, as high stocks of food compensate for the possible reduction in yields due to El niƱo, according to the report of the Bank.

In the group of metals and metallurgical raw materials the most severe decline, as experts predict WB will show iron ore (-25%). Such dynamics is due to the weakening demand, especially from China.

The average annual price of gold in 2016, according to forecasts of the Bank, will be reduced by 7.3% to us $1075 per ounce, not $1156, as was assumed in October.

In 2017, the prices of most raw materials will significantly increase compared to current year, in particular, is projected to increase average annual oil price to $48 per barrel (in October it was supposed to increase to $54,6 per barrel). But gold will drop to $1066 per ounce.

The forecast changes of prices of raw materials in 2016-2017:

The change in 2016 to 2015
Change in 2017 to 2016


Oil the (basket)

Non-energy raw materials
Falling 3.2%


The precious metals


Agricultural products
Of 1.4%
+1.6% of