The surge in energy prices poses huge near-term risk to global inflation and if not curbed, could weigh heavily on growth in energy-importing countries.
Oil prices have increased above $80 per barrel in recent weeks, the highest point in years amid shipping bottlenecks as economies struggle to recover from the effects of the pandemic.
The increase in prices have been more pronounced than previously projected and may complicate policy choices in countries.
The World Bank uses an average of Brent, West Texas Intermediate, and Dubai which it said will remain at high levels in 2022 but will start to decline in the second half of the year as supply constraints ease.
Report warn that additional price spikes may occur in the near-term amid very low inventories and persistent supply bottlenecks.
