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ENERGY and metal commodity prices are expected to continue to fall by 2020 following sharp declines this year on a weaker outlook for global growth and consequent softer demand, an official said.
The World Bank said this in its October Commodity Markets Outlook released on Tuesday in Washington.
Ayhan Kose, Director of the Bank Group’s Prospects Group said crude oil prices were projected to average 60 dollars per barrel this year and weaken to 58 dollars per barrel 2020, said the outlook.
In line with the slowdown in global growth, oil consumption is now expected to rise at a much slower pace than in earlier forecasts, the new report showed.
The release noted that a “sharper-than expected economic downturn” poses the greatest risk to the oil price forecast.
More broadly, energy prices, which also include natural gas and coal, are expected to average almost 15 per cent lower in 2019 than in 2018, and to continue to decline in 2020, the report said.
Prices of metal, including iron ore, copper and zinc, are also projected to fall 5 per cent this year and continue to slide next year as slowing global demand weighs heavily on the market, according to the October outlook.
Precious metals, which have risen sharply this year, are anticipated to make further gains in 2020 in response to heightened global uncertainty and accommodative monetary policies, the outlook showed.
The report added that prices of agricultural commodities were anticipated to decline this year but stabilise in 2020.
“Depending on export revenues from a small set of commodities makes commodity-exporting developing economies vulnerable because demand surges and higher prices could induce innovation and facilitate substitution among commodities,” said Kose.
A resolution of trade tensions could push up the prices of some agricultural commodities, such as soybeans and corn, while lower energy prices could lower fuel costs and fertiliser prices, reducing prices of energy-intensive crops such as oilseeds, the report saidNAN
– Oct. 29, 2019 @ 19:05 GMT |
Tags: metal prices as global growth weakens World Bank revises down energy
