WASH­ING­TON–The World Bank says gains from low oil prices can be sub­stan­tial for the Caribbean and oth­er de­vel­op­ing-coun­try im­porters if sup­port­ed by stronger glob­al growth.

In analysing the oil price de­cline, the Wash­ing­ton-based fi­nan­cial in­sti­tu­tion in its lat­est edi­tion of Glob­al Eco­nom­ic Prospects re­leased this week, said the de­cline re­flects a "con­flu­ence of fac­tors." This in­cludes sev­er­al years of "up­ward sur­pris­es" in oil sup­ply and "down­ward sur­pris­es" in de­mand, re­ced­ing geopo­lit­i­cal risks in some ar­eas of the world, a sig­nif­i­cant change in pol­i­cy ob­jec­tives of the Or­ga­ni­za­tion of the Pe­tro­le­um Ex­port­ing Coun­tries (Opec) and ap­pre­ci­a­tion of the US dol­lar.

"Al­though the rel­a­tive strength of the forces dri­ving the re­cent plunge in prices re­mains un­cer­tain, sup­ply re­lat­ed fac­tors ap­pear to have played a dom­i­nant role," said the bank, adding that soft oil prices are ex­pect­ed to per­sist in 2015 and will be ac­com­pa­nied by sig­nif­i­cant re­al in­come shifts from oil-ex­port­ing to oil-im­port­ing coun­tries.For many oil-im­port­ing coun­tries, the World Bank said, low­er prices con­tribute to growth and re­duce in­fla­tion­ary, ex­ter­nal and fis­cal pres­sures.

At the same time, the bank said weak oil prices present "sig­nif­i­cant chal­lenges for ma­jor oil-ex­port­ing coun­tries, which will be ad­verse­ly im­pact­ed by weak­en­ing growth prospects, and fis­cal and ex­ter­nal po­si­tions."If low­er oil prices per­sist, they could al­so un­der­mine in­vest­ment in new ex­plo­ration or de­vel­op­ment," it said. "This would es­pe­cial­ly put at risk in­vest­ment in some low-in­come coun­tries, or in un­con­ven­tion­al sources such as shale oil, tar sands and deep sea oil fields."

Ay­han Kose, di­rec­tor of de­vel­op­ment prospects at the World Bank, said for pol­i­cy­mak­ers in oil-im­port­ing de­vel­op­ing coun­tries, the fall in oil prices "pro­vides a win­dow of op­por­tu­ni­ty to un­der­take fis­cal pol­i­cy and struc­tur­al re­forms as well as fund so­cial pro­grammes."In oil-ex­port­ing coun­tries, the sharp de­cline in oil prices is a re­minder of sig­nif­i­cant vul­ner­a­bil­i­ties in­her­ent in high­ly con­cen­trat­ed eco­nom­ic ac­tiv­i­ty and the ne­ces­si­ty to rein­vig­o­rate ef­forts to di­ver­si­fy over the medi­um and long term," he said.

The analy­sis on oil prices in Glob­al Eco­nom­ic Prospects is com­ple­ment­ed by two spe­cial fea­tures on how trends in glob­al trade and re­mit­tance flows are im­pact­ing de­vel­op­ing coun­tries.The World Bank said glob­al trade ex­pand­ed by less than 3.5 per cent in 2012 and 2013, well be­low the pre-cri­sis av­er­age an­nu­al rate of sev­en per cent, "hold­ing back de­vel­op­ing coun­try growth in re­cent years."

Weak de­mand, main­ly in in­vest­ment but al­so in con­sumer de­mand, is one of the main caus­es of the de­cel­er­a­tion in trade growth, the bank said.