•Brent could spike to $120 per barrel —JPMorgan •More revenue for Nigeria, yet bitter-sweet situation —Expert
Oil and gas facilities across the Middle East were shut down on Monday as Israeli and U.S. strikes on Iranian targets and retaliatory attacks by Iran entered a third day, triggering fears of significant supply disruptions and pushing global crude prices sharply higher.
Market analysts at JPMorgan Chase warned that Brent crude could spike to as high as $120 per barrel if the conflict intensifies and key export routes remain constrained.
The projection comes amid mounting concerns over disruptions to critical infrastructure and shipping lanes in the oil-rich region.
Brent crude, the global benchmark, surged by about nine to 13 percent during intraday trading, briefly crossing $82 per barrel before easing to around $79 — its highest level since August 2024.
Refineries, Oilfields, Gas Assets Shut
In Saudi Arabia, state oil giant Saudi Aramco temporarily halted operations at its 550,000 barrels-per-day Ras Tanura refinery following a drone strike.
The facility, one of the kingdom’s largest domestic refineries and a critical export terminal, reportedly suffered a limited fire caused by debris from intercepted drones. Authorities described the situation as under control.
In Iraq’s semi-autonomous Kurdish region, companies including DNO, Gulf Keystone Petroleum, Dana Gas and HKN Energy suspended most of their oil production.
The region typically exports about 200,000 barrels per day through a pipeline to Turkey’s Ceyhan port.
Offshore Israel, Chevron shut down the Leviathan gas field as a precautionary measure, while Energean halted output from its floating production vessel serving smaller fields. Gas exports to Egypt have consequently been curtailed.
Explosions were also reported near Iran’s Kharg Island, which handles roughly 90 percent of the country’s crude exports. Iran, a key member of OPEC, accounts for about 4.5 percent of global oil supply.
Tensions have further escalated around the Strait of Hormuz, the strategic maritime chokepoint through which nearly one-fifth of global oil consumption passes.
Shipping activity has slowed amid reported vessel attacks, raising fresh concerns about global energy security.
For Nigeria, the surge in oil prices presents a mixed outlook.
With crude trading well above the proposed 2026 budget benchmark of $64.85 per barrel, higher prices are expected to boost government revenues and foreign exchange inflows, offering temporary fiscal relief.
However, industry experts warn that the gains may be offset by rising domestic fuel prices and inflationary pressures.
Speaking in Lagos, energy analyst Joe Nwakwue described the development as a “bitter-sweet experience” for Nigeria.
“When oil prices go up, the Nigerian state earns more from crude exports. But the Nigerian consumer pays more for petrol, diesel and other petroleum products,” he said.
According to him, the ripple effects could extend beyond fuel pumps.
“Energy is a major component of Nigeria’s inflation basket. If oil prices remain elevated, we could see inflation begin to rise again after recent moderation,” he noted.
He added that aviation fuel costs — a significant component of airline operations — could push up ticket prices, while transport and power generation expenses may also increase.
Industry sources confirmed that Dangote Refinery recently raised petrol prices by N100 per litre, with expectations of further upward adjustments if global crude prices remain elevated.
Analysts say while Nigeria may benefit from improved oil earnings in the short term, the broader economic impact will depend on how effectively additional revenues are managed and whether global tensions ease.
As the Middle East crisis deepens, energy markets remain on edge, with traders closely monitoring developments around critical infrastructure and export routes that could determine the next direction of global oil prices.