Brent crude tops $100 as Middle East fighting squeezes global oil supply

Brent crude surged past $100 a barrel on Wednesday for the first time since July, closing at $101.21, as renewed fighting between the United States and Iran around the Strait of Hormuz tightened global energy supplies and sent a fresh wave of anxiety through oil-importing emerging economies.indianexpress+1

The price spike, driven by U.S. strikes on Iranian oil tankers near Kharg Island and retaliatory Iranian ballistic missile launches, has deepened concerns that a prolonged period of triple-digit oil prices could tip vulnerable economies toward recession. The IMF on Thursday said the global economy had weathered the energy shock better than feared but cautioned that risks remain high, with the disinflation process stalled and global public debt approaching 100% of GDP by decade's end.reuters+1

India Braces for a Record Import Bill

India, the world's third-largest oil consumer, faces some of the sharpest consequences. The country imports more than 88% of its crude, and every $1-per-barrel increase adds up to $2 billion to its annual import costs. India's crude oil import bill already surged 56.5% year-on-year in April–July to $63.4 billion, even as import volumes barely changed.theprint+1

If prices sustain at $100 per barrel through the current financial year, the oil import bill could exceed $200 billion, according to the Indian Express, up from about $135 billion in 2025–26. ING commodities strategists Warren Patterson and Ewa Manthey said in a note Wednesday that "the market is likely to continue to price in a sizeable risk premium" given the breakdown in U.S.-Iran peace talks. Morgan Stanley ↘ 0.55% had forecast last week that Brent would average $100 in the October–December quarter.indianexpress

Public-sector fuel retailers Indian Oil, Bharat Petroleum and Hindustan Petroleum are estimated to be losing about Rs 5 per litre on petrol and over Rs 20 on diesel at current prices, having only partially passed on the international price rise to consumers.indianexpress

Nigeria Faces Fresh Fuel Price Shock

In Nigeria, oil marketers warned that pump prices would rise following the next round of purchases. Joseph Ehimen, Lagos State chairman of the Petroleum Products Retail Outlets Owners Association, said adjustments would reflect "all cost elements, including logistics to filling stations". Diesel has already approached N2,000 per litre in parts of the country, roughly 150% higher than a year ago, squeezing manufacturers who depend on generators for power.dailytrust+1

The Manufacturers Association of Nigeria said industrial growth nearly halved from 7.46% to 3.96% in the second quarter of 2026, with manufacturing's share of GDP falling from 9.57% to 7.72% in a single quarter. Emmanuel Onuorah, president of the Premium Bakers' Association, described the operating environment bluntly: "I'm not thinking of profitability; I'm thinking of, let us just remain afloat".dailytrust

IMF Warns Energy Shock "Is Not Over"

IMF spokesperson Julie Kozack said Thursday that oil and gas prices remained elevated and that the energy shock from the six-month-old Middle East conflict was not over. The Fund projects global growth of about 3% in 2026, down from an average of 3.5% in 2024 and 2025, with headline inflation forecast at 4.7%.businessupturn+1

The concern extends beyond crude. Higher energy costs feed into transportation, manufacturing, food production and electricity, potentially forcing central banks to keep monetary policy tighter for longer. Countries that had drawn down strategic reserves now face the prospect of returning to the market to rebuild stocks, adding demand pressure at a time of constrained supply.indianexpress+1

> "The energy shock is not over," IMF Managing Director Kristalina Georgieva said on September 1, pointing to disrupted flows through the Strait of Hormuz and rising energy demand.businessupturn