World Bank warns 24% energy surge

The World Bank said on April 28 that energy prices are on track to surge 24% in 2026 as war in the Middle East disrupts oil supply and shipping. (worldbank.org) The bank’s baseline assumes the most acute disruptions end in May and traffic through the Strait of Hormuz gradually returns toward prewar levels by late 2026. Under that scenario, Brent crude still averages $86 a barrel this year, up from $69 in 2025. (worldbank.org) (openknowledge.worldbank.org) The World Bank said the March 2026 oil supply loss reached about 10 million barrels a day, which it called the largest oil supply shock on record. Before the conflict, the Strait of Hormuz handled about 35% of global seaborne crude trade and 20% of liquefied natural gas trade. (openknowledge.worldbank.org) The warning reaches beyond gasoline and diesel. The bank forecasts overall commodity prices will rise 16% in 2026, fertilizer prices 31%, and urea 60%, pushing inflation higher and growth lower in emerging-market and developing economies. (worldbank.org) (openknowledge.worldbank.org) A separate disruption hit Russia’s Black Sea coast the same day. Russian authorities said a Ukrainian drone attack set Rosneft’s Tuapse refinery on fire on April 28, the third strike on the site in less than two weeks. (usnews.com) (themoscowtimes.com) Reuters, cited by U.S. News, reported the refinery has capacity of about 12 million metric tons a year, or roughly 240,000 barrels a day, and had already stopped operations after an April 16 attack. The Moscow Times reported local evacuations and more than 300 emergency workers battling the latest blaze. (usnews.com) (themoscowtimes.com) The World Bank’s downside case is worse. If Middle East disruptions last longer or deepen, it said Brent could average $95 to $115 a barrel in 2026, with other commodity prices climbing well beyond current forecasts. (openknowledge.worldbank.org) Chief Economist Indermit Gill said the shock would hit in “cumulative waves” through energy, then food, then inflation and interest rates. The bank said up to 45 million more people could fall into acute food insecurity this year if the conflict drags on. (worldbank.org) For now, the World Bank’s message is that even a partial easing in the Gulf leaves energy markets far tighter than expected in January. A refinery fire in Tuapse showed how quickly another outage can add pressure to an already strained system. (openknowledge.worldbank.org) (usnews.com)