The World Bank (WB) predicts the historical increase in prices in the world for energy (50%) and non -energy products (20%) in 2022 due to the situation around Ukraine, TASS reports.
According to the April report (Commodity Market Outlook), prepared by experts of the World Bank, the conflict caused serious interruptions in deliveries. “It is expected that in 2022 the prices of most energy carriers will be much higher than in 2021. At the same time, there will be no decrease in prices in the medium term,” the report said.
It is noted that, although the WB also suggested a serious increase in prices in 2022, the real indicators were much higher than predicted. At the same time, the development of the situation in the raw material market largely depends on the duration of the conflict in Ukraine, according to the bank.
According to the forecasts of WB analysts, in 2022 the price of Brent oil will reach the maximum since 2013 and amount to $ 100 per barrel, which is 42% higher than the average annual price for 2021. “In general, changes in nominal prices from April 2020 to March 2022 led to the largest increase in energy prices since the growth in oil prices in 1973, ”the report says. The report notes that the prices for non -energy products will increase by about 20%. So, the expected increase in wheat prices is more than 40%.
Regarding the reaction to the crisis in the energy sector, analysts note that the governments of many countries have resorted to a policy of reducing taxes and issuing subsidies. According to the WB, these measures, although they will help somewhat soften the situation in the short term, will only aggravate the problem in the future, since they will cause an increase in the demand for fuel and aggravate the deficit. The expansion of sanctions against Russia can lead to serious interruptions in the fuel market. The authors of the report do not see equivalent replacement for Russian gas and oil.