Analyst Predicts Triple-Digit Oil Prices as New Normal

Analyst Lukman Otunuga from FXTM has indicated that triple-digit oil prices may become a new normal as the global energy market braces for a prolonged period of high costs. This situation is exacerbated by supply tightness and geopolitical tensions, particularly following the collapse of diplomatic talks regarding Iran's nuclear program.

The U.S. has vowed to block vessels passing through the Strait of Hormuz, a critical chokepoint for oil transport, which has led to a surge in Brent crude prices, reaching approximately $104 per barrel. The market reacted sharply, with Brent rising by 9 percent amid fears of supply shocks.

The ongoing conflict and the U.S. stance on Iran have created a precarious environment for oil prices, which could lead to increased inflation and complicate monetary policy for central banks, including Nigeria's, which may consider rate cuts in response to local inflation projected at 13.4 percent. The situation remains volatile, with Brent crude previously touching $120 per barrel during extreme market fluctuations.