Russia- Ukraine war to cause biggest price shock in 50 yrs: World Bank

The price shock is aggravated by restrictions in the food, fuel, and fertiliser trade, it said

The world faces the biggest commodity price shock since the 1970s due to the Russia-Ukraine war, the World Bank said in its latest Commodities Market Outlook report. Global food and fuel price shocks linked to the war are set to last until at least the end of 2024 and raise the risk of stagflation, it added.  It is being aggravated, it said, by restrictions in food, fuel and fertiliser trade that are exacerbating already elevated inflationary pressures around the world. 

“Policymakers should take every opportunity to increase economic growth at home and avoid actions that bring harm to the global economy,” said Indermit Gill, the World Bank’s Vice President for Equitable Growth, Finance, and Institutions.

Russia is the world’s largest natural gas and fertiliser exporter, and second largest crude oil exporter. Together with Ukraine, it accounts for nearly a third of global wheat exports, 19 per cent of corn exports and 80 per cent of exports of sunflower oil exports.

Production and exports of these and other commodities have been disrupted since Russia’s invasion.