By Opeyemi Adelakun
Global crude oil prices have moved above $100 per barrel as renewed military confrontation between the United States and Iran raises concerns over disruptions to supplies from the Middle East.
Brent crude, the international benchmark, climbed to about $101.20 per barrel on Wednesday after gaining more than three per cent during the session. West Texas Intermediate, the US benchmark, traded around $96 per barrel.
The latest rally reflects growing uncertainty over the security of oil shipments and production infrastructure in the region. Reuters reported that Brent settled at $101.21 per barrel on Wednesday, its highest closing level since May.
The escalation followed a fresh exchange of military attacks between Washington and Tehran.
The United States Central Command said American forces destroyed five Iranian crude-oil carriers, with four struck in the Gulf of Oman and another near Kharg Island. The action followed ballistic missile attacks by Iran’s Islamic Revolutionary Guard Corps on a US Navy warship.
Iran subsequently launched ballistic missiles towards American forces stationed at Jordan’s al-Azraq Air Base. Jordanian authorities said 18 of 20 missiles were intercepted, while the remaining two landed in unpopulated areas without causing casualties.
The IRGC also claimed attacks against US vessels and oil tankers, although those claims had not been independently verified.
The latest developments have compounded concerns over the security of energy transportation through the Gulf region.
The Strait of Hormuz, one of the world’s most important oil shipping routes, has experienced a sharp reduction in traffic since the conflict intensified. Reuters reported that oil flows through the waterway had fallen below two million barrels per day, compared with substantially higher volumes before the latest escalation.
The situation has also been worsened by attacks by Iran-backed Houthi fighters on energy facilities in southern Saudi Arabia, raising fears that the disruption could spread to other production and transportation routes.
For Nigeria, sustained high crude prices could provide additional revenue for the Federal Government because international benchmarks are now significantly above the $64.85 per barrel assumption contained in the 2026 federal budget.
Higher prices could increase government earnings from crude oil royalties, taxes and other petroleum-related revenues if the elevated market conditions persist.
However, the development also carries a downside for Nigerian consumers, particularly because the country remains exposed to movements in international petroleum markets.
The latest increase in crude prices has coincided with a significant rise in petrol costs, with the average price increasing from about N830 per litre in February to approximately N1,310 per litre.
The development comes at a time when Nigerians are already dealing with elevated transportation and energy costs.
Industry data also show that imported petrol has become more expensive than locally refined products. Recent figures from the Major Energies Marketers Association of Nigeria put Dangote Petroleum Refinery’s gantry price at N1,265 per litre, compared with an import-parity price of more than N1,310 per litre.
While higher crude prices could strengthen Nigeria’s external earnings, analysts and policymakers will have to balance the potential revenue gains against the inflationary pressure that higher energy prices could impose on businesses and households.
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