How the Israel-Iran War May Make Oil More Expensive in Nigeria

The impact of the ongoing tensions in the Middle East is being felt around the world as Israel reportedly launched strikes inside Iran, targeting missile and drone sites. 

This comes after months of growing heat involving not just Israel and Iran, but also the United States, which continues to play a strong role in the region.

While the full picture of the conflict is still unfolding, one thing is already clear, oil prices are on the rise. While Israel says it hit key nuclear and missile sites, Iran hasn’t confirmed the full extent of the damage or its plans to respond. So far, oil flows through the vital Strait of Hormuz remain unaffected, but markets are reacting to fears of escalation. 

The U.S. has stayed on the sidelines for now, though it’s unclear if that will last. Experts remain split, some expect tensions to ease soon, while others warn the region could slide into a wider war.

According to sources, crude oil prices jumped over 4% following the Israeli strikes. Brent crude climbed to over $87 per barrel, and this kind of spike usually has a ripple effect across economies that depend on oil, including Nigeria.

Why this matters for Nigeria

Nigeria is an oil-producing country, but ironically, Nigerians don’t always benefit when oil prices rise. Here’s why the Israel-Iran-US conflict could mean more pain at the pump and in your pocket,

• Import-Driven Fuel Market: Nigeria still imports most of its refined fuel. So when global oil prices shoot up, landing costs increase — and that often leads to higher pump prices for petrol and diesel.
  
• Pressure on Subsidies: If the Nigerian government keeps fuel subsidies in place, rising oil prices will put massive pressure on public finances. On the other hand, removing subsidies completely could cause a major hike in fuel prices and transport fares.
  
• Freight Disruptions: According to Argus Media, there’s growing concern in the global shipping industry. If freight routes in the Middle East are disrupted, it could delay fuel imports into Nigeria and push prices even higher due to added risk charges.
  
• Inflation Risks: Higher fuel prices typically drive up the cost of food, transportation, and basic goods. This could worsen Nigeria’s already high inflation and deepen hardship for everyday citizens.
  

What you should know

The situation in the Middle East remains fragile. If the conflict escalates or if Iran retaliates with attacks on oil facilities or shipping lanes (like the Strait of Hormuz), oil prices could climb even higher. 

That would almost certainly impact Nigeria’s economy. For now, Nigerians should brace for possible increases in fuel costs, not because of local production issues, but because of bombs dropping thousands of kilometers away.

In a global economy, no country is too far from the shockwaves of war.