Prices of Oil is expected to have upward surge in 2017 according to World Bank forecast.
The report projects crude oil prices to leap to $55 per barrel from $53 per barrel earlier projected as members of the Organization of the Petroleum Exporting Countries (OPEC) prepare to limit production after a long period of unrestrained output.
According to the revised forecast which appears in the World Bank’s latest Commodity Markets Outlook. Oil prices are expected to average $43 per barrel in 2016, as contained in the July report.
The report noted that Energy prices, oil, natural gas and coal, would jump almost 25 percent overall next year. This represents a larger increase than anticipated in July.
Accordingly, John Baffes, Senior Economist and lead author of the Commodity Markets Outlook said. “We expect a solid rise in energy prices, led by oil, next year.
Baffes expressed fear that the implementation of the OPEC agreement will undoubtedly impact oil markets.
The report also anticipated modest recovery for most commodities in 2017 as demand strengthens and supplies tighten.
Accordingly, Metals and Minerals prices are expected to rise 4.1 percent next year, a 0.5 percentage point upward revision due to increasing supply tightness. Zinc prices are forecast to rise more than 20 percent following the closure of some large zinc mines and production cuts in earlier years.
Gold is projected to decline slightly next year to $1,219 per ounce as interest rates are likely to rise and safe haven buying ebbs.