Global crude oil prices are edging close to the $120 per barrel mark as renewed tensions in the Middle East disrupt supply expectations and rattle energy markets, raising fresh concerns for fuel prices.
Benchmark crude, including Brent crude, has surged sharply in recent days amid fears of supply constraints linked to geopolitical instability in the Middle East fueled by the US-Iran war.
The U.S. has continued to seek to pile pressure on Iran with the naval blockade outside the Strait of Hormuz even as the Trump Administration insists the blockade is yielding results and will not be lifted anytime soon.
“While the surviving IRGC Leaders are trapped like drowning rats in a sewage pipe, Iran’s creaking oil industry is starting to shut down in production thanks to the U.S. BLOCKADE,” U.S. Treasury Secretary Scott Bessent said in a post on X.
“Pumping will soon collapse. GASOLINE SHORTAGES IN IRAN NEXT!,” Bessent added.
In another post, the Secretary wrote that “Kharg Island, Iran’s primary oil export terminal, is soon nearing storage capacity, which will force the regime to reduce oil production, resulting in an additional approximately $170 million per day in lost revenue, and causing permanent damage to Iran’s oil infrastructure.”
Analysts warn that if tensions persist, prices could climb even higher, compounding inflationary pressures worldwide.
For Nigeria, the development presents a paradox. As Africa’s largest oil producer, higher crude prices typically translate to increased government revenue and improved foreign exchange inflows.
This means that while the government may earn more from crude exports, ordinary Nigerians are likely to face higher fuel prices and rising living costs.
Since the commencement of the Iran war, prices of premium motor spirit (PMS) also known as petroleum have tripled with a litre now sold at N1,245 to N1,350 thereby increasing transport cost.
Oil industry analyst, Dr. Ayodele Oni said, “Brent near $120 is a double-edged sword for Nigeria. Yes, the Federation Account will swell with petrodollars — but Nigerians will feel the pain first. Higher crude prices mean costlier fuel, elevated transport fares, and rising prices for virtually every good on the shelf.
“For ordinary Nigerians, an oil boom at the wellhead rarely translates to relief at the pump or the market. However, with Nigeria now able to refine locally, the effect will not be as bad as it would have been if we were importing finished products. If we were importing finished products, prices would have been much higher and fuel scarcity and queues would have been the order of the day.”
