Akintunde Oyedokun
Research Analyst
Oil prices rose on Wednesday, supported by escalating U.S.-Iran tensions and a larger-than-expected drop in U.S. crude inventories. Brent crude climbed 1.6% to $92.90 per barrel, while WTI gained 2% to $90.00. A 7.2 million-barrel decline in U.S. stockpiles further boosted market sentiment. Concerns over potential supply disruptions in the Middle East also underpinned prices.
U.S. Inflation Hits Three-Year High on Rising Energy Costs
U.S. inflation accelerated to 4.2% in May, its highest level in three years, as soaring energy prices pushed consumer costs higher. Real wages fell for a second straight month, adding pressure on household budgets.
The data supports expectations that the Federal Reserve will keep interest rates elevated for longer as inflation remains above its 2% target.
BoC Holds Rate at 2.25%, Signals Caution on Inflation
The Bank of Canada left its key interest rate unchanged at 2.25%, saying higher energy prices have yet to significantly affect broader inflation. Governor Tiff Macklem said the bank remains ready to raise rates if inflation risks increase. While the economy remains weak, policymakers expect inflation to ease toward the 2% target and are closely monitoring energy prices and trade-related uncertainties.
South Africa Warns of Inflation Risks, Signals Rate Hike Possibility
South Africa’s central bank said the financial system remains resilient despite economic pressures from the Iran conflict. Rising oil prices are expected to increase inflation and could trigger another interest rate hike in 2026 after May’s rate increase.
The bank also flagged risks from cyber threats, AI developments, capital outflows, fiscal challenges, and household financial stress, while noting that strong foreign exchange reserves continue to support financial stability.
Nigeria Targets Better Petroleum Sector Performance
The Ministry of Petroleum Resources says it is taking steps to improve implementation in the oil and gas sector, focusing on crude theft, underinvestment, and project delays.
At a retreat in Abuja, officials outlined plans to boost crude production, expand gas output, increase local refining, and strengthen accountability to drive sustainable growth in the sector.
