The World Bank has projected that Brent crude oil prices, Nigeria's benchmark, will fall to an average of $79 per barrel in 2027. This forecast is based on recovering global production and weak oil consumption. The bank's Commodity Markets Outlook report notes that prices will approach $100 per barrel in the fourth quarter of 2026 due to supply disruptions in the Middle East, tanker shortages, and attacks on vessels.
According to the World Bank, crude shipments from the Gulf are expected to remain elevated, allowing global oil production to recover in 2027 and putting downward pressure on prices. The bank projects that the front-month Brent oil price will remain elevated in the near term, averaging almost $100 per barrel in 2026 Q4 and $91 per barrel in 2026 as a whole. Next year, the price is expected to recede gradually to an average of $79 per barrel.
The World Bank's outlook points to a reversal in energy prices after a year of supply disruptions. The bank projects global energy prices to rise by 32 percent year-on-year in 2026 before declining by 12 percent in 2027. Compared to its April forecasts, the bank raised its energy price projections by seven percent for 2026 and 14 percent for 2027, reflecting expectations that supply disruptions will persist longer than previously anticipated.
The global oil market is expected to remain in deficit in the fourth quarter of 2026, supporting prices before recovering production eases supply constraints next year. On the demand side, global oil consumption is projected to contract by 2.6 million barrels per day, or 2.5 percent this year, according to the World Bank. This decline will rank as the third-largest on record, after the contractions recorded during the COVID-19 pandemic in 2020 and the oil market turmoil of 1980.
The combination of weaker demand and recovering supply is expected to ease pressure on prices in 2027, although the pace of the decline will depend on developments in the Middle East and the durability of crude shipments from the Gulf. The forecast comes amid heightened volatility in global oil markets as tensions involving the United States and Iran raise concerns about disruptions to energy supplies.
Brent oil prices retreated on October 26 after approaching their highest levels since May, as hopes of reduced hostilities between Washington and Tehran eased concerns about potential supply disruptions. The World Bank's latest projections suggest that oil prices could remain elevated in the near term before easing as production recovers. However, a prolonged disruption to Gulf shipments might delay the anticipated decline.
The World Bank's forecast has implications for Nigeria, which relies heavily on oil exports. The country's economy has been impacted by fluctuations in global oil prices, and the projected decline in prices could affect government revenue. The Nigerian government may need to adjust its budget and economic plans in response to the changing global oil market landscape.
Key points
- The World Bank projects Brent crude to fall to $79 per barrel in 2027.
- Global energy prices are expected to rise by 32 percent year-on-year in 2026 before declining by 12 percent in 2027.
- Global oil consumption is projected to contract by 2.6 million barrels per day, or 2.5 percent this year.
