Global fuel markets are experiencing intense volatility as escalating tensions in the Middle East disrupt energy supply routes, sending oil prices sharply higher and pushing shipping costs to unprecedented levels.
According to analysis reviewed by the Accra Street Journal (ASJ), countries heavily dependent on imported petroleum products are facing the greatest risk as freight costs surge and supply chains tighten.
The managing director and chief executive officer of Dangote Petroleum Refinery, David Bird, says the current market conditions could place enormous pressure on fuel-importing economies.
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Tanker Shipping Costs Skyrocket
Speaking during a media briefing, Bird revealed that the cost of transporting fuel cargoes has risen dramatically amid the geopolitical turmoil.
Freight charges for tanker shipments have climbed from roughly $800,000 per cargo to about $3.5 million per shipment, reflecting rising insurance premiums, security risks and supply chain disruptions.
Energy analysts say the surge highlights how geopolitical conflicts can quickly translate into higher costs across global energy markets.
Much of the world’s oil shipments pass through the Strait of Hormuz, making the corridor a crucial transit point for petroleum exports from the Middle East.
Any disruption along this route can rapidly affect fuel supply chains worldwide.
Import-Dependent Countries Face Greatest Risk
According to Bird, countries that rely heavily on imported fuel are particularly vulnerable to these shocks.
They must absorb not only rising crude oil prices but also higher shipping costs, increased insurance premiums, and potential delays in cargo deliveries.
This combination can quickly translate into higher domestic fuel prices, increased inflation, and broader economic pressure.
For many developing economies, including several in Africa, such shocks can strain government budgets and foreign exchange reserves.
Nigeria’s Fuel Prices Climb
In Nigeria, the impact of the global energy turmoil is already being felt.
The Dangote refinery has raised its ex-depot (gantry) petrol price multiple times in recent days as market conditions shift rapidly.
Prices have climbed from ₦774 per litre to ₦874, then ₦995, and most recently ₦1,175 per litre.
These increases reflect a combination of rising crude oil prices, surging tanker freight costs and broader instability across global energy markets.
Benchmark oil prices have also surged dramatically, jumping from the mid-$60 range to nearly $120 per barrel within a single week.
Domestic Refining Offers Some Protection
Despite the market turmoil, Nigeria may be somewhat insulated from severe supply disruptions due to the presence of domestic refining capacity.
The Dangote refinery, Africa’s largest refining facility, has the capability to meet much of Nigeria’s domestic fuel demand.
According to Bird, the refinery is currently operating at its full nameplate capacity of approximately 650,000 barrels per day, with the potential to increase output to around 700,000 barrels per day.
Domestic refining reduces dependence on imported fuel shipments, which can become delayed or prohibitively expensive during periods of geopolitical crisis.
This capability can help prevent the fuel shortages and long queues that have historically followed major global oil market disruptions.
Global Pricing Still Applies
However, Bird emphasized that the refinery remains fully exposed to global commodity pricing.
Even though the plant processes crude oil produced within Nigeria, the feedstock is purchased at international benchmark prices.
Under the government’s crude-for-naira arrangement, the refinery still pays global market rates for crude oil, meaning that fluctuations in international prices continue to affect domestic fuel costs.
Strategic Lessons for African Economies
For the Accra Street Journal (ASJ), the ongoing energy market turbulence highlights the strategic importance of domestic refining infrastructure.
Countries that rely entirely on imported fuel remain highly exposed to geopolitical shocks and shipping disruptions.
By contrast, nations with local refining capacity can better manage supply during periods of global volatility.
As tensions continue to affect global energy markets, the situation underscores a broader lesson for African policymakers: energy security increasingly depends on building domestic refining and supply capacity.
Source: Accra Street Journal
Last Updated on March 14, 2026 by Samuel Kwame Boadu
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Samuel Kwame Boadu is a Ghanaian media entrepreneur and storyteller with a passion for amplifying urban voices and uncovering everyday truths. He is the Editor-in-Chief and Founder of Accra Street Journal, a dynamic digital platform dedicated to capturing the pulse of Ghana’s capital—its people, culture, challenges, business, sports and innovations.
