If the War Doesn't Expand, World Bank Predicts Lower Oil Prices

Market

Lite

Adi Ahdiat 31/10/2023 15:04 WIB

URL has been copied

Memuat...

If the Israeli-Palestinian conflict does not escalate, the World Bank projects that global crude oil prices will tend to decline until 2025.

World Bank Projection of Average Brent Crude Oil Prices per Year (2021-2025)

A Font Kecil
A Font Sedang
A Font Besar

Access single data

If the War Doesn't Expand, World Bank Predicts Lower Oil Prices

Want to get more access to Data Stories with a more affordable price? Subscribe.

By subscribing, you join us in presenting quality data.

Get:

Premium Data Stories access
Comfortable reading without ads
Download data in XLS, PDF, and image format
Access to data source information

Basic

~~Rp100.000~~

Rp50.000/month

Professional

~~Rp100.000~~

Rp150.000/month

Institutional For organizations

We accept the following payments:

Some payment methods are still in the process of being activated.

World Bank Projection of Average Brent Crude Oil Prices per Year (2021-2025)

Download

Source

A Small Font
A Medium Font
A Bigger Font

The Israel-Palestine war, which erupted on October 7, 2023, is not predicted to significantly affect global crude oil prices, as the warring parties are not major oil producers.

This was stated by the World Bank in its October 2023 edition of the *Commodity Markets Outlook* report.

"Assuming the conflict in the Middle East does not escalate, the average Brent crude oil price is projected to reach US$84/barrel in 2023, down from an average of nearly US$100/barrel in 2022," the World Bank said in its report.

The World Bank also projects that global oil prices will tend to decline over the next two years.

"The average Brent crude oil price is projected at US$84/barrel in 2023, then more moderate in 2024 amid weakening global economic growth and increased supply, and tend to stabilize in 2025 as demand and supply recover," they said.

However, the World Bank mentions several factors that risk driving up oil prices, one of which is the expansion of the Israel-Palestine war.

"Although Israel and Gaza are not major energy producers, escalation and the spread of the conflict to wider areas could lead to increased oil and other commodity prices," they said.

According to the World Bank, this occurred during the 1973 Yom Kippur War, when Israel fought against Arab countries led by Egypt and Syria.

In that war, Arab countries imposed an embargo or ban on oil trade with countries supporting Israel.

"The Arab oil embargo (during the Yom Kippur War) lasted from October 1973 to March 1974, resulting in the removal of 4.3 million barrels of oil per day from the market, equivalent to 7.5% of global supply," said the World Bank.

"During the embargo, OPEC (the Organization of the Petroleum Exporting Countries) raised oil prices from US$2.7 per barrel in September 1973 to US$13 per barrel in January 1974. Although the embargo lasted only five months, real oil prices remained high and never returned to pre-embargo levels," it continued.

"The oil price shock at that time had a severe impact, causing a surge in global inflation and playing a major role in triggering the 1975 global recession," said the World Bank.

Editor : Adi Ahdiat

"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."