Global crude oil prices climbed sharply on Thursday as renewed military exchanges between the United States and Iran heightened fears of fresh supply disruptions across the Middle East, reinforcing concerns over the security of key global oil transit routes. The latest escalation came despite continued tanker movements through the Bab el-Mandeb Strait, with traders weighing the growing geopolitical risks against evidence that oil exports from the region have not been completely interrupted.
As at the time of writing 08:07 am (WAT), Brent crude traded at $92.94 per barrel, up 2.42 per cent, West Texas Intermediate (WTI) rose 1.16 per cent to $85.44 per barrel according to Oilprice.com market data.
The latest rally followed reports that the United States launched fresh strikes on targets inside Iran in retaliation for missile attacks on American forces stationed in Jordan. At the same time, US and Saudi forces reportedly targeted Iran-backed armed groups in Iraq over intelligence suggesting planned attacks on Saudi energy infrastructure, further escalating tensions across the oil-rich region.
The geopolitical uncertainty deepened after Egyptian authorities confirmed that a drone strike targeted a US-owned floating storage tanker at the Port of Damietta, with subsequent reports indicating that two liquefied natural gas tankers were affected. The incident added to mounting concerns over the vulnerability of energy infrastructure across the Middle East, a region responsible for a significant share of global crude oil exports.
Despite the renewed hostilities, oil prices pared some earlier gains after shipping data showed that crude exports from the region had not ground to a halt. Ship-tracking firms reported that 39 commodity carriers successfully exited the Bab el-Mandeb Strait on Tuesday, while vessels continued navigating alternative export routes, even as traffic through the Strait of Hormuz remained below normal levels.
Analysts said the continued movement of tankers has eased immediate fears of a complete supply shock. IG Group market analyst Tony Sycamore noted that although shipping volumes have declined, crude oil continues to leave the region through multiple channels, reducing Iran's ability to use the Strait of Hormuz as a strategic pressure point over global energy markets.
However, market analysts cautioned that risks remain elevated. Commodity strategists at ING warned that repeated attacks on Saudi energy infrastructure could prolong supply disruptions, particularly in the middle distillates market where refining margins have continued to surge to record levels.
The latest price movements underscore the fragile balance between geopolitical tensions and physical oil supply. While uninterrupted tanker traffic has prevented a more severe price spike, traders remain highly sensitive to any further military escalation that could threaten critical export corridors across the Middle East.
For Nigeria, sustained gains in international crude prices could provide additional revenue support as Africa's largest oil producer benefits from stronger export earnings. However, higher global crude prices may also increase the replacement cost of refined petroleum products, potentially exerting fresh pressure on domestic fuel prices despite the expanding local refining capacity led by the Dangote Petroleum Refinery.