Brent climbs to six-week high as attacks on oil tankers and energy facilities fuel fresh supply concerns….
Global oil prices have climbed sharply, with Brent crude crossing the $100-a-barrel mark on Wednesday as the escalating US-Iran conflict raises fresh concerns about the security of crude shipments and global supplies.
Brent, the international benchmark, gained 2.13 per cent to trade at $100 a barrel, its highest level in six weeks. US West Texas Intermediate, WTI, also advanced by 1.76 per cent to $94.67 per barrel.
The latest rally reflects growing fears that the conflict could disrupt alternative shipping routes for crude as oil flows through the Strait of Hormuz remain severely restricted.
The Red Sea, which has become an increasingly important alternative route for oil shipments, is now facing heightened security concerns as hostilities between the United States and Iran intensify.
The situation worsened on September 8 after the US Central Command said American forces had destroyed five Iranian crude oil carriers following attempted missile attacks on a US Navy warship over two consecutive days.
The conflict has already sent Brent prices significantly higher. Since hostilities began on February 28, the benchmark has risen as high as $125 a barrel, reaching that level on April 30.
Supply concerns have also been heightened by developments in Saudi Arabia, where the government said attacks by Yemen’s Iran-aligned Houthi movement targeted several energy facilities in the southern part of the kingdom on Tuesday.
The attacks reportedly triggered fires and forced the temporary suspension of some operations, adding to concerns over the vulnerability of energy infrastructure in the region.
Meanwhile, major oil producers have moved to take a more cautious position on output.
The Organisation of the Petroleum Exporting Countries, OPEC, and its allies agreed on September 6 to suspend planned increases in oil production and retain their October output levels amid uncertainty surrounding the global market.
The decision followed a review of developments in the international oil market and its outlook, with Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria and Oman among the countries involved.
For Nigeria, the renewed surge in international crude prices could have significant implications for the domestic downstream market.
Higher global oil prices are expected to increase pressure on petrol prices, which have already climbed above N1,300 per litre, potentially raising transportation and operating costs for households and businesses.
The development could also have implications for Nigeria’s oil revenues, although the extent of the benefit to government finances will depend on domestic crude production, export volumes and other factors affecting the country’s oil sector.
