Global oil prices have climbed above $100 a barrel as escalating conflict in the Middle East raises fears of further disruption to energy supplies.
Brent crude, the international benchmark, settled at $101.21 a barrel after returning to triple digits. US benchmark crude finished at $96.05.
The latest rise follows renewed attacks on oil facilities and shipping in the Middle East, increasing concerns about the security of global energy routes.
Strait of Hormuz disruption drives oil prices higher
Tensions around the Strait of Hormuz remain a major factor behind the surge.
The strategic waterway handled roughly one-fifth of the world’s oil supply before the conflict disrupted shipping through the area.
Oil prices initially jumped after fighting involving the United States, Israel and Iran intensified earlier this year. Brent briefly approached $120 before falling back toward $70 as hopes of easing tensions grew.
Those expectations have since weakened as attacks resumed and diplomatic efforts faltered.
Africanews, citing AP, reported that renewed hostilities around the Persian Gulf have again pushed energy markets higher.
African economies face higher fuel costs
The effects are already being felt beyond the Middle East, particularly in countries that depend heavily on imported fuel.
Nigeria has experienced some of the sharpest increases. Diesel prices have risen by more than 90%, while gasoline prices are nearly 58% higher, according to Global Petrol Prices data cited in the report.
Higher crude prices can also increase the cost of transporting food, medicines and other goods.
Airlines and shipping companies face higher fuel bills, while rising diesel costs can make road transport and agricultural production more expensive.
That means a prolonged period of expensive oil could eventually feed into consumer prices across African economies.
How high could oil prices go?
The key question for markets is how long the disruption will continue.
Bank of America analysts cited in the report said persistent disruption around Hormuz could push oil into a range of $95 to $120 a barrel.
More serious damage to major energy infrastructure could potentially cause temporary spikes as high as $150, according to their assessment.
For oil-importing economies, the duration of the crisis may therefore prove as important as the $100 milestone itself.