Petrol price hike looms as Brent Crude hits $115 amid US-Iran tensions

The price of petrol in Nigeria could come under renewed upward pressure following a surge in international crude oil prices, with Brent crude rising to $115.18 per barrel on Friday amid fears of fresh military strikes on Iran.

The increase comes as the Dangote Petroleum Refinery and other depot owners sell petrol at N1,350 per litre at their gantries, raising concerns about the possibility of another round of price increases.

According to OilPrice.com, Brent crude climbed by 1.8 per cent to $115.18 per barrel, its highest level in five months, while US West Texas Intermediate crude rose by two per cent to $101.56 per barrel.

Reuters reported that Brent touched $115.16 per barrel, its highest level since May 4, as escalating tensions in the Middle East heightened fears of further disruptions to global energy supplies.

The international benchmark was on course for a weekly gain of about five per cent, marking its third consecutive week of increases.

The rally has been driven largely by concerns that the United States could resume military strikes against Iran, alongside attacks on energy infrastructure and threats to critical shipping routes.

US President Donald Trump reportedly said on Wednesday that Washington was not negotiating with Iran and that something would happen “fairly soon”. The remarks came amid reports that US and Israeli officials were considering fresh strikes after the American midterm elections.

Iran’s army chief, according to state media agency Tasnim, said the country’s military was fully prepared for “asymmetric warfare” following improvements in its military capabilities.

The tensions have also spread to Saudi Arabia, where Iran-allied Houthi militants have continued attacks. The US State Department reportedly ordered non-essential personnel to leave the country amid the deteriorating security situation.

A drone attack targeting the Shaybah oil field in Saudi Arabia’s Eastern Region on Wednesday reportedly killed two people and injured two others. Another attack on King Fahd International Airport in Dammam left at least two people dead and eight injured, according to Saudi state media.

Reuters also reported that Saudi Aramco ordered employees to evacuate its headquarters in Dhahran and work remotely following the attacks.

Of particular concern to oil traders is the Strait of Hormuz, a strategic waterway through which a substantial share of global oil supplies passes. Disruptions to shipping through the strait have heightened market volatility, while further attacks could tighten supplies and increase freight and insurance costs.

For Nigeria, a sustained rise in international crude oil and refined-product prices could increase the cost of supplying petrol to the domestic market, putting additional pressure on pump prices.

Although no fresh price increase has been announced by refiners or importers, marketers could face higher replacement costs, potentially prompting them to adjust their selling prices.

Such an increase would place further pressure on households and businesses already contending with high fuel costs and persistent inflation.

The Dangote Petroleum Refinery, one of the major suppliers to Nigeria’s domestic petrol market, last raised its gantry price from N1,265 to N1,350 per litre, effective September 12.

However, whether the latest rally in global oil prices will translate into another increase in Nigerian petrol prices remains uncertain.