The International Monetary Fund (IMF) has projected that global oil prices will decline by 15.5% this year.

It in latest World Economic Outlook Report, which was published today, the IMF said that the prices of fuel commodities are projected to decrease in 2025 by 7.9%, with a 15.5% decline in oil prices.

IMF’s Chief Economist Pierre-Olivier Gourinchas explained at a press conference that the drop in oil prices is largely because of weaker global demands.

“So, we have seen oil prices declining since our last projections, and the decline in oil prices in our interpretation is coming mostly from weaker global demands. So, it is the weakening of global activity that is driving the decline in prices. There has been some increase in supply coming from the OPEC + countries but broadly speaking the decline is mostly coming from weaker demand,” the Chief Economist explained.

He warned that the decline could result in lower export revenues for oil producing nations than earlier anticipated.

“The commodity exporters are going to face lower export revenues from the decline in oil prices, that’s going to weigh on their fiscal outlook on their growth,” he said.

The steep decline in oil prices could have implications for oil producing nations such as Guyana. The drop in global demand is happening at a time when Guyana is ramping up oil and gas production.

While the IMF is predicting a dip in the oil prices, it also projects that there will be a 22.8% decrease in natural gas prices. Non-fuel commodity prices are also projected to increase by 4.4 percent in 2025, while food and beverage prices have been revised upward compared with those in the January 2025 World Economic Outlook Update.

The IMF, in its report, said following an unprecedented series of shocks, global growth was stable in 2024, and was predicted to remain so in 2025, however, the landscape has changed significantly as governments around the world reorder policy priorities. It explained that since the release of the World Economic Outlook in January 2025, a series of new tariff measures have been introduced by the United States and countermeasures by its trading partners,  bringing effective tariff rates to levels not seen in a century.

“This on its own is a major negative shock to growth. The unpredictability with which these measures have been unfolding also has a negative impact on economic activity and the outlook and, at the same time, makes it more difficult than usual to make assumptions that would constitute a basis for an internally consistent and timely set of projections,” the IMF said.

Under the reference forecast that incorporates information as of April 4, global growth is projected to drop to 2.8 percent in 2025 and 3 percent in 2026—down from 3.3 percent for both years in the January 2025 WEO Update, corresponding to a cumulative downgrade of 0.8 percentage point, and much below the historical (2000–19) average of 3.7 percent.

In early March, in its preliminary report on the conclusion of the 2025 Article IV Mission, the IMF said Guyana’s economic transformation was advancing at a strong pace.

That growth was linked to the country’s rapidly expanding Oil and Gas Sector, as well as advancements made in the non-oil sector.

It estimated then that the country’s Gross Domestic Product (GDP) will grow by about 10¼ percent, while the non-oil economy will grow by 13% in 2025.

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