According to the World Bank's Commodity Markets Outlook, global commodity prices are forecast to increase by around 20% in 2018. In particular, oil prices are likely to rise by 22%, from an average of US$53 in 2017 to US$65/bbl in both 2018 and 2019, supported by global strong demand and continued production restraint by OPEC and non-OPEC producers. Besides, higher oil prices are expected to eventually feed into higher natural gas prices (+8% in 2018), while coal prices will continue to decline to an average US$85/Mt in 2018, as energy demand shifts towards cleaner energy sources.
In the first quarter of 2018, energy prices already surged 10%, led by oil and natural gas. Oil prices rose by 10% and averaged US$64.6/bbl, while coal prices rose by 4% and natural gas prices by 11%.
In 2017, natural gas and coal prices grew by 21% and 34%, respectively. Coal prices rose mainly due to strong consumption in China spurred by cold weather, low inventories and production constraints. Gas prices increased because of the strong winter consumption, which depleted storage levels in all core regions.