By Onyekachi Victoria Philip
The global oil market has been thrown into another wave of uncertainty as crude prices continue their upward march, drawing fresh attention from especially businesses worried about the growing impact of escalating tensions in the Middle East.
According to a further report, Brent crude climbed to $98.47 per barrel on Thursday, moving within touching distance of the $100, while West Texas Intermediate (WTI) rose to $90.11 per barrel, showing concerns that disruptions to key oil shipping routes could tighten global supplies even further.
The latest price rally follows renewed hostilities involving the United States and Iran, with fears mounting that prolonged instability could affect the movement of millions of barrels of crude through the Strait of Hormuz,one of the world’s busiest oil transit corridors.
Adding to market jitters, Iran-backed Houthi fighters have resumed attacks on commercial vessels in the Red Sea, targeting oil tankers travelling through another critical maritime route.
The developments have forced some shipping operators to review their routes, raising concerns over higher transportation costs and possible delays in global oil deliveries.
The ripple effects are already being felt beyond the energy sector. Rising crude prices often translate into higher fuel costs, increased transport expenses and more expensive goods, creating fresh inflationary pressures for economies around the world.
For Nigeria, the situation presents a mixed picture. While stronger oil prices could improve export earnings and government revenue, they may also raise the cost of imported petroleum products, transportation and food distribution, placing additional pressure on households and businesses.
The Central Bank of Nigeria recently maintained its Monetary Policy Rate at 26.5 percent, which reveals growing global uncertainties including the renewed Middle East tensions as one of the reasons for sustaining its cautious monetary policy stance.
Source: Nairametrics