World Bank on Tuesday maintained its forecast for oil prices for this year, while upgraded its projections for major non-energy commodity prices.
In its latest quarterly Commodities Markets Outlook report, the Washington-based lender forecast the crude oil prices in 2017 to reach 55 U.S. dollars per barrel, the same forecast as it made in last October. But the expected price was up 29 percent from 2016.
"The energy price forecast assumes members of the Organization of the Petroleum Exporting Countries (OPEC) and other oil producers will partially comply with an agreement to limit production after a long period of unrestrained output,"said the World Bank in the report.
It expected the oil market to tighten in 2017, particularly in the second half of this year, which would help reduce the large stock overhang.
The lender projected the non-energy commodity prices to increase 3 percent in 2017, the first increase in six years for both metals and agricultural prices.
Metals prices are forecast to rise 11 percent amid increasing tight supply, after dropping 6 percent in 2016. The forecast was up from the 4 percent rise anticipated in last October.
Agricultural prices as a whole are expected to rise by less than 1 percent in 2017, but grains prices are forecast to drop 3 percent due to improved supply outlook.