World Bank: Global food and fuel price shocks will last at least 3 years

The World Bank said in its latest commodity market outlook report that global food and fuel price shocks are expected to last at least until the end of 2024 and increase the risk of stagflation.

In the first comprehensive analysis of the impact of the war in Ukraine on commodity markets, the World Bank, which provides loans and grants to low- and middle-income countries, said the world is facing the biggest shock to commodity prices since the 1970s.

He added that this shock is exacerbated by restrictions on trade in food, fuel and agricultural fertilizers (fertilizers), which are already adding to high inflationary pressures around the world.

Russia is the world's largest exporter of natural gas and fertilizer and the second largest exporter of crude oil.

Together with Ukraine, it constitutes about a third of global wheat exports, 19 percent of corn exports and 80 percent of sunflower oil exports, and the production and exports of these and other commodities have been disrupted since the Russian war on Ukraine on February 24.

As a result, the World Bank expects energy prices to jump more than 50 percent in 2022 before declining in 2023 and 2024, while the prices of non-energy products, including agricultural products and minerals, are expected to rise by about 20 percent in 2022 before recording increases. moderate.

The bank said commodity prices would decline only slightly and would remain well above their most recent five-year average in the medium term.

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