Global oil prices remained above $100 per barrel on Friday and were on course to finish the week above that level for the first time since mid-May, as attacks along major Middle East shipping routes continued to raise concerns about global energy supplies.
According to Reuters, Brent crude futures fell 1.53% to $105.98 per barrel, while U.S. West Texas Intermediate crude dropped 1.33% to $101.12. Despite Friday’s decline, both benchmarks remained more than 10% higher for the week after gaining over 6% on Thursday.
Prices eased after reports that Middle Eastern foreign ministers were working on a temporary agreement with Iran to manage shipping through the Strait of Hormuz. However, concerns about further disruptions remained high.
The Strait of Hormuz is particularly important to global energy markets because it handled about one-fifth of daily global oil and liquefied natural gas supplies before the Iran war began in late February.
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Shipping activity through the strait has fallen sharply. Preliminary ship-tracking data showed vessel transits dropped to seven on Thursday from 11 a day earlier, well below the 10-day average of 15.
The disruption follows a series of attacks in the region. Iran said it attacked 10 ships near the Strait of Hormuz on Wednesday after the United States struck five Iranian oil tankers.
Concerns have also spread beyond the Gulf after Iran-aligned Houthis seized control of Yemen’s port of Mocha, creating another potential risk for shipping through the Red Sea.
Attacks from Yemen on Saudi energy facilities have further raised fears that disruptions could continue across a wider part of the Middle East.
The International Energy Agency said the global oil supply gap is expected to deepen this year as the continuing Iran war delays a return to normal Middle East oil flows into 2027.
The effects are already extending beyond crude oil markets.
In the United States, the national average diesel price climbed above $6 per gallon for the first time on record on Thursday, according to GasBuddy.
Supply disruptions caused by the Iran war have combined with Ukrainian attacks on Russian refineries to place additional pressure on refined petroleum products.
Tim Waterer, chief market analyst at KCM Trade, said diesel was facing pressure from both Gulf shipping restrictions and outages at Russian refineries.
The developments leave global energy markets exposed to further volatility, with the direction of prices likely to depend heavily on whether shipping conditions improve and whether the Middle East conflict escalates further.
What This Means For Africa
Oil remaining above $100 per barrel creates different consequences across African economies.
For major crude exporters, elevated prices can support export earnings and government revenue when production volumes remain stable. Countries with significant oil exports could therefore benefit from stronger international prices.
The picture is more difficult for African countries that depend heavily on imported petroleum products. Higher crude and refined fuel prices can raise import bills, transport expenses and production costs, adding pressure to inflation and foreign exchange demand.
Even oil-producing countries that import substantial quantities of refined petroleum products can face higher domestic costs when international fuel prices rise.
Disruptions around the Strait of Hormuz and Red Sea also matter because these are important routes for international trade. Prolonged instability could affect shipping costs and supply chains beyond the energy market.
With Brent above $105 and major shipping routes under pressure, African governments, businesses and consumers will be watching whether the current surge proves temporary or develops into a longer period of elevated energy costs.
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Image Credit: ARAB NEWS
