Oil above $100 is once again at the center of the market, and the fear of a new wave of price increases is no longer an abstract risk
The price of oil has once again crossed the psychologically and economically important threshold of $100 per barrel, and energy markets have entered a phase in which no longer only the price trend is being monitored, but also every signal about how long the disruption could last. After a new escalation of the conflict with Iran and disruptions in production, storage, and maritime traffic in the Persian Gulf, futures contracts on Brent and U.S. WTI rose sharply. That is precisely why energy commodities have once again become one of the main topics for governments, central banks, logistics companies, and industry, because the price of crude oil does not remain only on financial terminals, but very quickly spills over into fuel, freight transport, service prices, and the costs of everyday life. In such an environment, it is no longer just about one stock-market jump, but about a test of the resilience of the global economy after a period in which inflation in many countries had only just begun to calm down.
A surge driven by war, risk to the Strait of Hormuz, and fear of a longer supply interruption
The latest price increase is not the result of just one event, but of a combination of military strikes, reduced production, and a sudden rise in the risk premium on the market. According to available information from international media and energy institutions, on March 9, 2026, Brent jumped above $100, and at one point even approached the level of $120 per barrel. Such a move shows how sensitive the market is when the area through which a large part of the global oil trade passes is threatened. The Strait of Hormuz remains a key point of global energy infrastructure: through this narrow sea passage, according to data from the U.S. Energy Information Administration and the International Energy Agency, around 20 million barrels of oil and petroleum products pass daily, that is, approximately one fifth of global consumption of liquid fuels and about one quarter of global seaborne oil trade. When threats to tankers, insurers, and port operators appear on such a route, the market does not wait for a formal blockade to react, but immediately prices in a shortage scenario.
That is precisely the reason why the exchange price has been moving sharply and nervously these days. It is enough for some shipowners to slow navigation, for insurance to become more expensive, or for producers to temporarily reduce deliveries because of security risk and storage problems, for supply expectations to change almost overnight. In this case, it is a market that remembers very well the experiences from 2022, but also earlier energy shocks, so it reacts in advance. Oil therefore is no longer just a commodity traded according to classic supply-and-demand ratios, but also a political thermometer. The greater the uncertainty about the length of the conflict and the safety of navigation, the greater the probability that the high price will remain for longer than a few days.
Why the $100 threshold is so important
In commodity markets, round numbers have both psychological and practical weight. The level of $100 per barrel is not only a symbolic warning that energy is expensive again, but also a signal to companies that cost pressures could become more serious. When oil stays high for a longer period, refineries, distributors, airlines, shipping companies, and road carriers begin recalculating the prices of their services and products. Part of the blow can be absorbed in the short term by margins or existing inventories, but that applies only to a limited extent. After that, the price increase begins to pass through the entire chain, from wholesale energy prices to the consumer basket.
That is precisely why economists pay special attention not only to the peak price, but also to the duration of the shock. A one-day jump can remain a market incident, but a multi-day or multi-week stay above $100 already changes business decisions. Companies postpone investments, increase caution in hiring, and revise price lists, while consumers begin to cut part of spending that is not necessary. At the level of states, this further complicates fiscal and monetary policy, because higher energy prices can slow economic activity precisely at the moment when central banks are hoping for the stabilization of inflation and interest-rate expectations.
Inflation might not return immediately, but the pressure would be fast and visible
In the euro area, according to Eurostat’s flash estimate, annual inflation in February 2026 amounted to 1.9 percent, after 1.7 percent in January. The energy component was still negative year on year, which shows that the European economy did not enter this episode of rising oil prices from an already overheated energy environment. But that is exactly what makes the current shock sensitive: a new upward correction in crude oil and fuel prices is arriving at a moment when the previous energy effects had begun to fade. If the new level were to hold, it would very quickly change the inflation picture in the coming months, first through fuel and transport, and then through goods and services that depend on transport, heating, the chemical industry, and logistics.
Research by the International Monetary Fund and the European Central Bank in recent years warns that the transmission of energy shocks to overall inflation is weaker than in older decades, but it has not disappeared. On the contrary, when overall inflation is elevated or expectations are sensitive, the effect can spill over into the so-called second round of price increases, through wages, services, and broader inflation dynamics. In other words, expensive oil does not automatically mean the return of double-digit inflation rates, but it does mean a greater risk that the slowdown in prices will stop or reverse. This is especially important for Europe, which remains highly exposed to imported energy shocks even when gas storage is well filled, because oil is the foundation for transport, petrochemicals, and part of industrial production.
The first blow will be felt by transport, logistics, and industry, and then household budgets
When crude oil rises, citizens first notice more expensive fuel. But the real economic effect is much broader. Road freight transport feels the pressure on diesel costs almost immediately, while airlines and shipping companies recalculate surcharges and routes. In manufacturing sectors, the costs of input raw materials rise, especially where oil and derivatives are not only an energy source, but also an industrial base, as in the chemical industry, the production of plastics, fertilizers, and packaging. As the cost moves down the chain, traders and manufacturers begin to build it into final prices, sometimes gradually and invisibly, but enough for consumers to feel a new round of price increases within a few weeks or months.
For households, the problem is that energy commodities act in a double way. First, they directly reduce disposable income through more expensive tank refills and higher transport costs. Second, they indirectly increase the prices of a wide range of products and services. In such circumstances, sectors that depend on discretionary spending perform worse, because citizens redirect part of their money to necessary expenses. This is a pattern that economies have already seen in earlier energy crises: a rise in oil prices is not only an inflationary risk, but also a recessionary risk, because it simultaneously pressures costs and weakens consumption.
The market is currently weighing between a short-term shock and a scenario of longer instability
It is important here to distinguish a dramatic daily jump from a long-term disruption. Before the latest escalation, energy institutions did not expect a permanently high oil price in 2026. As recently as February, the U.S. EIA estimated that the average Brent price during the year could be significantly lower than in 2025, assuming that global production would exceed demand. Fitch Ratings also warned at the beginning of March that the closure of the Strait of Hormuz, because of its enormous economic importance, would probably be temporary and that excess supply on the global market could mitigate a more long-term rise in prices. However, those estimates were made before the latest breakout of the price above $100 and are valid only on the condition that traffic and production normalize relatively quickly.
This is precisely where the key question for the coming days lies. If it turns out that this is a short market shock, the price could gradually fall, and most of the effect would remain limited to stock-market volatility and a short-term rise in fuel prices. But if the security threat to tankers, refineries, and export terminals persists, the market could begin to price in a much higher permanent risk premium. Then it would no longer be only the physical shortage of barrels that mattered, but also the change in the behavior of all participants: insurers, shipowners, importers, refineries, and financial funds that amplify the amplitude of moves through futures contracts.
Europe and small import economies are among the more sensitive to this development
For countries that secure a large share of energy and fuel from imports, such a price jump is particularly unpleasant. In recent years, Europe has worked intensively on reducing energy vulnerability, diversifying supply, and mitigating the consequences of the gas shock, but the oil market still remains global and very quickly transmits disruptions from the Middle East to the entire continent. Small open economies, including Croatia, have an additional problem because they cannot significantly influence the world price, but they strongly feel its consequences through imported inflation, transport costs, tourism, agriculture, and household consumption.
In such conditions, the Croatian fuel market necessarily follows international movements, even when in the short term there is a time lag due to inventories, procurement contracts, and the way retail prices are formed. For carriers, taxi drivers, delivery services, and farmers, any longer retention of a high price means a direct blow to business. For the broader economy, the problem is that the increased logistics cost very easily spills over into food, construction, consumer goods, and service prices. That is precisely why, in periods of oil shocks, not only energy is observed, but the entire structure of the economy that depends on transport and imported inputs.
Central banks are getting another reason for caution
When oil suddenly becomes more expensive, central banks do not react only to the number from the exchange, but to the question of whether the shock will remain long enough to change the expectations of households and companies. In its analyses, the European Central Bank has already pointed out that energy shocks can have a broader effect on core inflation, especially when they are combined with pressure on wages and services. Therefore, a further increase in oil prices, along with the already visible acceleration of overall inflation in February, could complicate estimates about the movement of interest rates and the pace of monetary easing. It is not the same whether energy is observed as a transient external blow or as the beginning of a new cycle of more expensive inputs.
Such uncertainty is usually also felt on financial markets. Higher oil can pressure the shares of carriers, industry, and sectors sensitive to consumption, while at the same time supporting energy companies and raw-material producers. The very change in inflation expectations can also raise bond yields and slow investment. That is why today’s movement in the price of oil is not only a topic of energy, but also a broader signal about how sensitive the global economy still is to geopolitical shocks, despite all attempts at diversification and strengthening resilience after previous crises.
What will be crucial is how long the disruption lasts and whether alternative supply channels will open
At this moment, the market still does not have a clear answer to the most important question: is this a shock that will last a few days or the beginning of a longer period of disruption in one of the world’s most important energy regions. If security circumstances stabilize, part of the current rise could turn out to be an exaggerated reaction caused by panic, reduced liquidity, and speculative positioning. But if tensions remain high and production and transport continue to suffer, then the world could very quickly enter a phase in which oil, inflation, and economic growth are once again observed as inseparably linked problems.
That is why the economy is now watching energy commodities hour by hour. Not only because of the price on the exchange, but because of the question of how much that number will change the cost of living, the competitiveness of companies, and the room for conducting economic policy. Oil above $100 per barrel is not in itself enough to automatically produce a new global inflation crisis, but it is a strong enough signal to warn how war, maritime security, and energy infrastructure are still among the most important drivers of prices in the everyday lives of citizens and in business.
Sources:- Associated Press – report on the jump in Brent and WTI prices above $100 and the impact of the war with Iran on production and transport (link)- Associated Press – report on the morning jump in the oil price toward $120 and the reaction of financial markets (link)- U.S. Energy Information Administration – overview of the importance of the Strait of Hormuz for global oil flows (link)- U.S. Energy Information Administration – international analysis of the world’s oil chokepoints and the share of the Strait of Hormuz in global consumption and maritime trade (link)- International Energy Agency – the security importance of the Strait of Hormuz for the global oil market (link)- Eurostat – flash estimate of inflation in the euro area for February 2026 (link)- U.S. Energy Information Administration – short-term energy outlook for 2026, including earlier estimates of Brent price movements (link)- Fitch Ratings – assessment that disruption in the Strait of Hormuz could be temporary, with a more limited longer-term effect due to excess supply (link)- International Monetary Fund – analysis of the transmission of oil-price shocks to inflation and price expectations in Europe (link)- European Central Bank – research on energy shocks and their contribution to European inflation (link)
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