Global crude oil prices have surged above USD 100 a barrel for the first time since May, driven by renewed military tensions in the Middle East, according to reporting from SBS News. The conflict, sparked by United States military strikes on Iran under President Donald Trump, has centered attention on critical maritime shipping lanes, including the Strait of Hormuz and the Bab al-Mandab strait off the coast of Yemen.
Global Oil Prices Surpass USD 100 Amid Middle East Conflict
According to Pedestrian.tv, the US military announced new strikes on Iranian targets and the resumption of a naval blockade on Iranian ports and coastal areas following attacks on merchant ships. President Donald Trump stated on Fox News that strikes will continue until he decides it is enough, and floated plans for the US to act as a guardian of the Strait of Hormuz while imposing a 20 per cent toll on cargo passing through the waterway. US Secretary of State Marco Rubio previously stated that no country is allowed to charge tolls or fees on an international waterway, whereas Iran’s foreign minister praised the toll suggestion in principle.
Impact on Domestic Fuel Prices and Government Response
The spike in international crude prices has heavily impacted domestic fuel markets. In Australia, petrol and diesel prices rose sharply, with unleaded in Melbourne rising six per cent to $1.80 per litre and diesel increasing 12 per cent to $2.17, as reported by SBS News. In Sydney, the NRMA reported that regular unleaded rose 10 cents to 171.5 cents per litre, while diesel climbed 22.0 cents to 209.2 cents per litre.
Prime Minister Anthony Albanese stated that his government is not planning to extend the country’s fuel excise discount past its upcoming expiration date, though he indicated there will be further announcements on fuel and noted that $10 billion has been set aside for a fuel security plan. Labor’s Emergency Management Minister Kristy McBain warned that if tolls and conflict continue pushing prices up, Australian households and consumers will ultimately pay the price. Federal government data shows Australia currently maintains 42 days of petrol, 38 days of diesel, and 32 days of jet fuel.
International Pressures and European Aviation
The oil price surge has also created severe cost pressures for international carriers. According to Yahoo Finance UK, EasyJet revealed a 70% drop in pre-tax profits to £85 million between April and June, down from £286 million during the prior year period, primarily due to increasing fuel costs and later bookings. Ryanair reported a 34% drop in after-tax profits to €538 million ($616 million) over the same period, falling short of analyst forecasts as the airline cut fares by six per cent to stimulate demand amid consumer hesitancy.
To mitigate future volatility, Ryanair noted that 80% of its fuel requirements until the end of March 2027 are hedged at $67 per barrel, while EasyJet stated that 72% of its H2 FY26 fuel CASK is hedged at $726 per metric ton.
Global Supply Concerns and Economic Anxiety
Energy experts have warned of further economic fallout if critical transit routes are restricted. Approximately seven per cent of the world’s oil output transits through Bab al-Mandab, and experts cited by SBS News note that a blockade there could push prices into the US$120–150 per barrel range.
Similar pressures are visible in Nigeria, where transport fares have risen and the price of Premium Motor Spirit climbed as high as ₦1,400 per litre amid the international crude price increase, according to