Oil tops US$100 as Iran conflict augurs pressure on Belize's fuel costs

Global oil prices climbed above US$100 a barrel on Thursday as renewed conflict involving Iran disrupted major shipping routes, raising the prospect of higher fuel prices in Belize, where transport costs are already the largest driver of inflation.

Brent crude, the international benchmark that influences fuel prices in Belize, rose to US$100.60 per barrel on Thursday, while U.S. benchmark West Texas Intermediate (WTI) climbed to US$91.63. The surge follows escalating military action involving Iran and attacks on oil shipping in the Red Sea, intensifying fears of supply disruptions across two of the world's most important energy corridors.

The latest spike comes after Houthi militants in Yemen claimed responsibility for attacks on two Saudi oil tankers in the Red Sea, while fighting between the United States and Iran continued. The conflict has already reduced shipping through the Strait of Hormuz, through which roughly one-fifth of the world's oil supply normally passes, forcing markets to price in the risk of prolonged supply constraints.

For Belize, which imports all of its petroleum products, sustained increases in global crude prices typically translate into higher domestic fuel prices after a lag, increasing transportation costs for businesses and households.

That relationship has already been reflected in the country's latest inflation data.

According to the Statistical Institute of Belize (SIB), the Consumer Price Index rose 4.3 percent in May compared to the same month last year, with the "Transport" category accounting for the single largest contribution to inflation.

The SIB reported that transport prices increased 14 percent over the year, driven primarily by higher motor fuel prices. Diesel rose by approximately 15.5 percent, regular gasoline by about 28.3 percent, and premium gasoline by roughly 17.3 percent compared with May 2025. Passenger transport services also recorded notable increases, reflecting higher fuel costs and international airfare.

The transport category alone accounted for nearly half of the overall increase in consumer prices during the month, underscoring the sensitivity of Belize's inflation rate to developments in global energy markets.

Higher fuel prices typically extend beyond motorists. Transportation costs affect freight, food distribution, construction materials, manufacturing inputs, tourism operations and public transportation, often leading to broader increases in the prices of goods and services throughout the economy.

Financial markets also reacted negatively to Thursday's developments, with major U.S. stock indices falling as investors weighed the inflationary impact of rising energy prices and the growing risk that the conflict could further disrupt global trade.

Energy analysts caution that much will depend on whether the conflict remains contained or expands further. Additional attacks on shipping infrastructure or prolonged disruptions to oil exports from the Middle East could place further upward pressure on crude prices in the coming weeks.

For Belize, any sustained rise above current oil prices could complicate efforts to moderate inflation after recent months of elevated transport costs and increase pressure on households already facing higher living expenses.