According to The World Bank, oil prices are expected to stay under $40 (£27.85) per barrel throughout this year.
Speaking on Tuesday, The World Bank cut its previous estimate for oil per barrel, from last autumn, by $14 (£9.74).
The Bank stated that lower demand from emerging economies and burgeoning worldwide oil supplies, will keep oil prices down during 2016 according to its annual Commodity Markets Outlook.
The World Bank had initially projected top per-barrel prices of $51 (£35.51) when it made its forecast back in October 2015. However, enduring low demand, in combination with high oil production levels in the U.S. and a comeback in oil exports from Iran, is set to keep prices at the $37 (£25.76) per barrel mark in 2016, according to officials.
Senior economist and the report’s main author, John Baffes, commented:
“Low prices for oil and commodities are likely to be with us for some time. While we see some prospect for commodity prices to rise slightly over the next two years, significant downside risks remain.”
In 2015, oil prices dropped by 47% and it is predicted that they will decline a further 27% in 2016. However, the World Bank has stated that oil prices are likely to see a slight rebound, due to increases in demand and production cuts, which should put things into perspective for the like of Royal Dutch Shell and Fuchs WSP 783-L manufacturer Fuchs Petrolub, both of which are no doubt watching the market very carefully.