Business
Global Food Prices Set To Soar As The Oil And Gas Crunch Continues
Oil and gas prices have risen dramatically this year as a result of under investment and recovering demand.
·Higher fuel prices are weighing on global food supply chains, with transportation and farming costs continuing to climb.
·The hardest hit will, once again, be those living in developing economies that are still struggling to recover from the impact of the pandemic.
The potential for a knock-on effect of rising fuel prices to be felt by other industries is becoming more likely, as oil and gas prices continue to rise to an all-time high, companies are finding it hard to maintain their costs and may have to shift this burden to the consumer any day now.
Petrol prices have risen higher and higher this year, as oil makes a comeback in 2021 following a difficult year of pandemic restrictions and low demand. This has, of course, been aided by the OPEC+ curbs on production that restricted oil output across member states for the first half of 2021. And while production levels are slowly rising, some countries are finding it difficult to reach new OPEC targets as they revive their oil and gas industries, meaning the global shortage continues.
Looking at the price of gasoline over the last 20 years, you can see that the global average has doubled, from $0.60 a litre in 2001 to $1.20 a litre today. This year, in particular, the increase in demand as economies open back up following over a year of restrictions, added to a supply shortage across much of the world, means prices are nearing an all-time-high.
And it seems that the trend is not over yet, with experts suggesting that motorists across Europe and Asia can expect high petrol and diesel costs well into the winter months as the Brent benchmark stays around $85 a barrel; demand for fuel increases; and taxes on motor fuel in countries such as India, France and the U.K. continue to stay at around 60 percent of the retail price of petrol and diesel. But what does this trend mean for other industries? As well as rising fuel prices, we are seeing the cost of food and drink increase, with average food prices hitting a decade high and costing around one-third more this September than last. Fuel costs cannot be blamed as the sole catalyst in rising food prices, as harvests hit by hot weather and Covid restrictions, an increase in global demand – with a dramatically cold 2020 winter and hot 2021 summer, and disruptions in the supply chain, are also to blame. But if transport and farming costs continue to rise, our food bill is likely to keep climbing.
Kavita Chacko, a senior economist at CARE Ratings in India explains, “High fuel prices put pressure on overall price levels and poses a downside risk to the recovery in mobility and the economy in general.” Moreover, “The rise in transportation costs have been feeding into costs across segments and could be a dampener for consumer spending,” she stated.
With globalisation meaning our food no longer comes from the local farm but is mostly shipped across the globe, as well as the rising price of fertilisers, the food supply chain is finding it hard to maintain stable prices.
Abdolreza Abbassian, Senior Economist at the UN’s Food and Agriculture Organisation’s told Bloomberg, “It’s this combination of things that’s beginning to get very worrying,” “It’s not just the isolated food-price numbers, but all of them together. I don’t think anyone two or three months ago was expecting the energy prices to get this strong.”
But the food supply chain is not the only thing we have to worry about when it comes to the knock-on effect of high oil prices. Any industry that relies on oil for fuel, fertilizers, petrochemicals, or any number of other related products is going to feel the pinch in the coming months, if they don’t already. This means the cost of many of our household products and basic expenses could soon increase.
This ticking time bomb has led Tom Kloza, global head of energy analysis for OPIS by IHSMarkit, to state, “every nook and cranny of the economy” could be affected. “Everything that moves tends to move cross-country by truck or by train, so we’re looking at a more expensive year for that.”
Essentially, anything that is used on freight transportation and any industry that relies on fuel or petrochemicals will likely be affected by the ongoing hike in oil prices. And while consumers are worried about petrol and diesel prices at present, this is just the tip of the iceberg.
The hardest hit will, once again, be those living in developing economies that are still struggling to recover from the impact of the pandemic. With an uneven economic recovery, due to low vaccine rollout figures and Covid restrictions needing to continue across several low-income countries, high fuel prices and the spillover effect on other industries, particularly food, could see governments having to provide economic stimuli to the poorest populations, as well imposing price caps on fuel.
One thing’s for certain, it’s going to get worse before it gets better. Those working in agriculture and industry are already taking the hit and it’s only a matter of time until this price burden is shifted to the consumer, not only at the pump but across a multitude of areas of our daily lives.
Bradstock reports for Oilprice.com.
The Minister of State for Industry, Trade and Investment, John Enoh said this at the 8th annual induction and conference of the Chartered Institute of Project Managers of Nigeria (CIPMN).
He explained that abandoned projects continue to lock up public funds that could have been used for infrastructure development, industrial growth, job creation and essential social services.
Represented by the ministry’s Permanent Secretary, Chris Osa Isokpunwu, he said the impact goes beyond financial losses, as incomplete projects affect communities and limit access to important public services
He cited examples of that remain unopened, schools that cannot accommodate students, roads that fail to connect communities and electricity projects that have not delivered their intended benefits.
The Registrar-General and Chief Executive Officer of CIPMN, Henry Ifeanyi Mbadiwe, also identified poor project management as a major challenge affecting development in Nigeria.
He revealed that the institute had developed a project management curriculum for Nigerian universities, which has received approval from the National Universities Commission (NUC). The programme is expected to enable universities to offer project management as a bachelor’s degree.
Mbadiwe further referenced findings by the Presidential Projects Assessment Committee, which identified 11,886 ongoing federal capital projects in 2011, with an estimated financial commitment of ?7.78 trillion.
He noted that inadequate planning, supervision, accountability and implementation were among the factors contributing to the abandonment of projects across the country.
The minister called for stronger project management structures across ministries, departments and agencies to improve planning, monitoring and evaluation.
He added that the Federal Ministry of Industry, Trade and Investment had introduced a 90-day implementation reporting cycle to strengthen transparency and monitor the progress of government programmes.
Ikenga said the company remained committed to Nigeria’s power sector and would continue investing in its operations despite the challenging business environment.
He spoke in Lagos at the third edition of the Shell Power Conference, themed “Powering Nigeria’s Progress: Turning Ambition and Action into Sustainable Impact”.
The Transcorp Power chief said the company would sustain electricity generation, invest in its facilities and deliver value to shareholders.
“Transcorp Power is a long-term player, not a short-term player. This year has been challenging, but what is important is getting power to schools, hospitals and businesses to power progress,” he said.
Ikenga said the company’s focus on operational efficiency and investment had strengthened its contribution to Nigeria’s electricity supply.
He disclosed that since acquiring the Ughelli Power Plant in Delta State in 2013, Transcorp Power had quadrupled its available generation capacity.
He also said the company became the first privatised power generation firm to receive a post-privatisation discharge certificate after fulfilling all its privatisation obligations.
The company’s unaudited results for the nine months ended September 30, 2026, showed a profit before tax of N83.1 billion, while its profit-before-tax margin rose to 31.2 per cent from 29.6 per cent recorded in the corresponding period of 2025.
Its total assets rose to 11.7 per cent amounting to N629.5 billion, while shareholders’ funds grew 8.9 per cent to N199.8 billion. Cash and cash equivalents also rose to N10.3 billion, supported by improved collections.
On the company’s contribution to grid stability, Ikenga said Transcorp Power’s black-start capability enabled it to restart operations without relying on electricity from the national grid.
He explained that the capability allowed the company to support power restoration following grid disturbances, helping to restore electricity supply to homes, businesses and industries.
Ikenga noted that Nigeria had an installed electricity generation capacity of about 13,000 megawatts, with an estimated potential of 50 gigawatts, adding that realising the potential would require effective coordination across the entire value chain.
“Everything in the value chain has to work,” he said.
He called for stronger collaboration among federal and state governments, regulators and private-sector operators, alongside increased private investment, to build a sustainable electricity market.
This was contained in a statement issued on Thursday by his Senior Special Assistant on Communications and Press Secretary, Maryann Duke.
The statement said Oyedele pointed to “improved digital systems, including electronic invoicing, as a key driver behind a record of N33tn in government revenue collected between January and October 2026.”
The minister said the performance demonstrated the potential of technology to improve revenue administration, strengthen compliance and increase efficiency across government institutions.
Speaking on the theme, ‘Digital Sovereignty and Ethics: Guarding the Economy for the Next Generation,’ Oyedele warned that Nigeria risked losing substantial economic opportunities if it continued to depend heavily on foreign digital infrastructure.
Citing Nigerian Communications Commission figures, he disclosed that the country recorded more than 157 million active internet subscriptions as of May 2026.
He explained that these connections generated significant volumes of information through financial transactions, healthcare, education and taxation.
However, citing estimates from the Nigeria Data Protection Commission, Oyedele said as much as 90 per cent of the country’s data was hosted abroad.
According to him, the situation has implications for foreign exchange expenditure, employment opportunities, technological skills and Nigeria’s control over information generated by its citizens.
He compared the country’s reliance on foreign digital infrastructure with its historical dependence on imported refined petroleum products, warning against a situation where Nigerian data would be processed abroad and the resulting services sold back to domestic users.
The minister consequently advocated greater investment in local data infrastructure, technical expertise, cybersecurity and predictable regulations to enable Nigerian businesses to capture more value from the digital economy.
He clarified that digital sovereignty should not translate into technological isolation but should strengthen Nigeria’s capacity to participate competitively in international markets.
Addressing graduating students, Oyedele urged young Nigerians to become developers of technological solutions rather than remain primarily consumers of products created elsewhere.
He identified artificial intelligence as both a disruptive force and an opportunity for innovation, advising graduates to acquire relevant digital skills alongside critical thinking, creativity, sound judgement and integrity.
The minister also cautioned against irresponsible online behaviour, explaining that digital footprints increasingly influence employment prospects, commercial relationships and professional credibility.
Oyedele outlined five priorities for graduates, including continuous learning, value creation, integrity, responsible digital citizenship and active participation in national development.
“Your degree is evidence of what you have learned. Your competence will demonstrate what you can do. Your character will reveal who you truly are,” he told the graduating students.
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