Israel-Iran Conflict: Oil Prices Poised to Surge Beyond $90 After U.S. Strikes — Experts Warn
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Israel-Iran Conflict |
Crude oil prices are expected to soar past $90 per barrel this week—up from just over $70—following a series of U.S. airstrikes on Iranian nuclear facilities. The move, described by former President Trump as a “spectacular military success,” has significantly heightened tensions in the already volatile Middle East.
Iran, a founding member of the Organisation of Petroleum Exporting Countries (OPEC), plays a crucial role in global oil supply. The ongoing conflict with Israel had already driven prices from $68 to $79 per barrel in recent weeks. The new wave of escalation is now pushing them even higher.
In an interview with Energy Vanguard, Dr. Diran Fawibe, Chairman of International Energy Services Limited, said:
“It is fundamentally clear that any disruption or restriction in the flow of oil through international supply chains will inevitably drive up crude oil prices.
“Oil buyers—whether traders or refiners—initially react with speculation over potential supply shortfalls. That anxiety often leads to real shortages, which then spark price hikes driven by imbalances between supply and demand.”
Dr. Fawibe further explained that Iran could either face a direct hit to its oil production or retaliate by attempting to block the Strait of Hormuz—a vital maritime passage for global oil shipments.
“Unless the crisis is brought under control quickly, a rise in crude oil prices is almost inevitable,” he said.
Similarly, Prof. Wumi Iledare, an expert in petroleum economics, noted:
“The U.S. strikes have introduced a short-term geopolitical risk premium into global oil prices. However, unless there's a significant disruption in physical supply—especially through the Strait of Hormuz—sustained price spikes remain uncertain.
“For Nigeria, a temporary boost in oil revenue may seem like a windfall, but it could also lead to rising inflation and a false sense of fiscal security. Without meaningful structural reforms, such a windfall might only deepen existing macroeconomic vulnerabilities and hinder recovery from past policy errors.”
Dr. Muda Yusuf, Director/CEO of the Centre for the Promotion of Private Enterprise (CPPE), echoed these concerns, warning that the escalating Israel-Iran conflict adds further strain to an already fragile global economic landscape.
“The world is already contending with multiple geopolitical shocks—from the Russia-Ukraine war to the Israel-Hamas conflict—not to mention the lingering impact of tariff disruptions under the Trump administration,” he said.
Dr. Yusuf pointed out that the increase in oil prices could benefit Nigeria’s foreign exchange earnings, especially if crude output improves:
“Oil remains Nigeria’s largest source of foreign exchange. A price increase to $75 per barrel—about 15% higher than pre-conflict levels—could boost our forex reserves, improve liquidity, and help stabilize the naira.
“Since the oil sector contributes around 50% of government revenue, any uptick in global prices could significantly bolster revenue generation. This, in turn, may support fiscal consolidation and help contain the fiscal deficit.”
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