Oil
Oil tops $116 as Middle East conflict strains global shipping
Global crude prices have climbed above $116 a barrel amid escalating Middle East tensions, while Nigerian production data shows rising local refinery allocations.
Key points
- Brent crude surpassed $116 a barrel following reports of potential US military strikes against Iran.
- Shipping costs for crude oil surged dramatically due to disruptions in the Strait of Hormuz and maritime risks.
- NUPRC data indicates domestic refinery crude supply reached 460,000 bpd in the first seven months of 2026.
What happened
Global crude oil prices climbed above $116 a barrel, reaching their highest level since April, according to reports by Arise News and Nournews. The price surge follows growing concerns over potential US military strikes against Iran and subsequent threats to energy infrastructure across the Middle East. Nournews reported that maritime shipping costs have risen sharply, with transport expenses for a two-million-barrel cargo from the US to Japan reaching approximately $81 million due to route restrictions and higher insurance premiums.
Meanwhile, official statistics from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in its publication 'The Upstream Gaze' showed that Nigeria's daily crude oil losses rose by 93.4 per cent to 17,600 barrels per day (bpd) between January and July 2026, following a five-year low in 2025. Total liquid hydrocarbon production averaged 1.63 million bpd during the same period. In a separate operation, the Nigerian Navy uncovered 132,000 litres of stolen crude oil in Rivers State under Operation Delta Sentinel.
What comes next
As geopolitical tensions persist in the Middle East, energy markets face continued volatility. The disruption of key shipping lanes and potential threats to regional oil facilities threaten to keep maritime transport costs elevated. In Nigeria, security forces continue to clampdown on oil theft and illegal refining networks, while domestic refineries absorb a larger share of national crude output, altering traditional export patterns.
Why it matters
According to US Energy Information Administration (EIA) data from October 2026, the Brent spot price stood at $115.22 per barrel, reflecting the broader inflationary pressures currently affecting global energy markets. For oil-producing nations like Nigeria, high international prices offer potential revenue gains, but surging shipping costs and regional conflicts demonstrate the fragility of global supply chains. At the same time, the rise in domestic crude allocation to 460,000 bpd in 2026 highlights a structural shift towards local processing, reducing export volumes but reshaping domestic energy security dynamics.
Original reporting
This article draws on the following reports. Read them in full on the publishers’ sites.
Context from CEII
Crude benchmarks move budgets, currencies and inflation in producer and importer countries alike. For economies such as Nigeria, where fuels dominate exports, production and refining decisions move the whole economy.
68.0% of Iran’s merchandise exports were fuels in 2023Written by the CEII Desk, the Centre’s automated newsroom, from the reporting credited above and CEII’s own data. Facts are attributed to their sources; the publishers have not reviewed this article. Spotted an error? Tell our editors.
