BAKU, Azerbaijan, October 31. The World Bank anticipates that global energy prices will further decrease by 5 percent in 2024, after experiencing a substantial 29-percent drop in 2023, Trend reports.
According to the forecast, this is primarily due to a subdued global growth that alleviates demand pressures. Beyond that, in 2025, energy prices are projected to exhibit a minor 0.7-percent decline.
Specifically, Brent crude oil price forecast for 2023 remains unchanged from the April outlook, with an expected average of $84 per barrel. This implies that prices will hover around the $90 per barrel mark in the final quarter.
Factors such as ongoing concerns about conflicts in the Middle East, geopolitical risks, the contraction of OPEC+ supply, and pressures from middle-distillate demand are anticipated to provide some support to prices in the last quarter, the WB noted. However, these forecasts collectively underline the expectation that the ongoing conflict will have a limited impact, as long as it doesn't escalate into a broader conflict. The forecast also assumes that global oil production will rise, both within and outside OPEC+, provided that certain OPEC+ supply cuts are reversed early in 2024.
Turning to natural gas, following a significant dip in European natural gas prices earlier in 2023, it is projected that natural gas prices will decrease by 4 percent in 2024, primarily due to reduced demand. This projection is contingent on relatively mild weather conditions in the Northern Hemisphere and no supply disruptions.
As for coal prices, they are expected to continue their downward trend, the outlook said. This trend is driven by increasing supply and weakening demand, particularly as coal consumption continues to be displaced in power generation and various industrial applications.