Oil prices surged to their highest levels in weeks on Tuesday, April 28, 2026, after the United Arab Emirates (UAE) announced it would withdraw from Organisation of the Petroleum Exporting Countries (OPEC) and US-Iran negotiations over the Strait of Hormuz made no meaningful progress.
This has compounded what the International Energy Agency (IEA) has called the greatest supply disruption in the history of the global oil market.
US West Texas Intermediate crude broke through US$100 per barrel, a level analysts regard as a key psychological resistance threshold, and rose to nearly US$102 in early morning trading. International benchmark Brent jumped sharply, advancing to nearly US$113 per barrel.
The twin shocks rattled markets already on edge, as President of the United States, Donald Trump told advisers he is not satisfied with Iran’s proposal to open the Strait and end the war. Iran has offered to reopen the strait if the US lifts its naval blockade, but the Islamic Republic wants to leave discussions on its nuclear programme to a later date; a condition US Secretary of State Marco Rubio publicly dismissed.
The price spike comes against a backdrop of prolonged structural damage to global energy supply. Crude and oil product flows through the Strait of Hormuz plunged from around 20 million barrels per day (bpd) before the war to just over 2 million bpd in March, while Gulf countries have cut total oil production by more than 14 million barrels per day.
The IEA’s April Oil Market Report noted that global oil supply plummeted by 10.1 million bpd to 97 million barrels per day in March, the largest disruption in history, while global observed oil inventories fell by 85 million barrels over the same period.
The UAE’s OPEC exit, effective 1 May, added a further layer of market uncertainty. The Emirati was the cartel’s third-largest producer and had been capped at approximately three million bpd under the OPEC+ framework, despite holding nameplate capacity above four million barrels per day.
Freed from quota discipline, the UAE is expected to ramp up output, but any near-term production gains remain constrained by the Hormuz closure. Long
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term, analysts believe the UAE could feasibly pump one million additional barrels per day outside OPEC, meeting approximately one percent of the world’s daily demand, though in the immediate term, demand has fallen sharply as prices have surged and storage is effectively maxed out.
According to recent reports, Citi has moved aggressively on its price outlook. The bank hiked its forecast, predicting that Brent could rise to as high as US$150 per barrel and remain at an average of US$130 through the third quarter, before easing to around US$100 in the fourth quarter. Goldman Sachs analysts estimate that 14.5 million bpd of crude oil production in the Persian Gulf region have been cut off as a result of the war with Iran.
Vitol Chief Executive, Russell Hardy, put the cumulative damage in starker terms. Speaking on earlier this month, he said one billion barrels of oil production will ultimately be lost because of the war, with the current loss already running between 600 and 700 million barrels.
The oil price trajectory has severe implications for Africa, which sits at the sharp end of the supply shock. Energy-importing economies across the continent are feeling the strain of higher import bills on top of already limited fiscal space and external buffers, while disruptions to fertiliser shipments — of which roughly one-third passes through the Strait of Hormuz, are raising fears about food prices as planting season begins in the Northern Hemisphere.
African airlines, heavily reliant on transit points in the Middle East, have had to suspend or reroute connections to the region, adding time and fuel costs and stranding citizens. Shipping giants have suspended operations through the Strait, raising fears of prolonged disruption to trade and supply chains across the continent. Nigeria and Angola, as oil exporters, stand among the few African economies positioned to benefit from elevated prices in the near term.
Parts of Africa have already faced supply disruptions, with governments implementing consumption-reduction measures as the crisis spreads westward from Asia. The International Monetary Fund (IMF) has warned that the shock is global but asymmetric; energy importers are more exposed than exporters, and poorer countries more than richer ones, with people in low-income developing countries most at risk given that food accounts for around 43 percent of consumption on average.
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The IEA’s base case assumes a resumption of regular oil and gas deliveries from the Middle East by mid-year, though it acknowledges this scenario could prove too optimistic given the high degree of uncertainty over how the situation may develop.
