The numbers tell a refreshing story. Brent crude, which scaled the terrifying heights of $120 per barrel in April 2026, is now trading at $72.
In a matter of weeks, global oil markets have undergone one of their most dramatic reversals in recent memory.
The catalyst is the Strait of Hormuz. For months, this narrow Persian Gulf corridor, through which nearly 20 percent of the world’s oil flows, was effectively shut.
The US-Iran conflict that erupted on February 28 strangled global supply and sent prices into panic territory.
Now, with an interim peace agreement in place, tanker traffic has doubled within 24 hours. The “energy crunch” that convulsed markets and boardrooms is retreating almost as fast as it arrived.
The price swing is extraordinary by any measure. From a stable $73 per barrel before the conflict, prices surged past $120 at the crisis peak.
Of course, it was a disaster for landlocked developing countries like Uganda, where the price of diesel shot up to around the UGX6,105 in major centers – the highest in many years.
Indeed, it even scaled the UGX10,000 per litremark in some countryside and remote towns due to logistics and distribution challenges.
Today, at $72, markets have essentially erased those gains. The correction reflects not only restored shipping routes but also a developing global supply surplus. Production is running at roughly 103.3 million barrels per day. Demand has fallen below 100 million barrels. That gap matters enormously.
The ships passing through the waterway in recent days include those carrying crude oil, liquefied natural gas (LNG), fertiliser and other goods, the BBC reports today.
But the deeper story here is about strategic reserves. Countries that held sufficient national inventory buffers were better placed to absorb the price shock.
Those without meaningful reserves faced brutal import bills during the crisis months. Uganda and many of its neighbours had little cushion.
When supply panic hit, their fuel costs spiked without relief. This is a policy failure that must not be forgotten now that prices have eased. Building and maintaining strategic petroleum reserves is not optional. It is the infrastructure of economic survival in a volatile world.
For low-income economies, the current price environment opens genuine breathing room. Fuel is embedded in virtually every sector: agriculture, transport, manufacturing, services. When oil prices fall, input costs fall with them. Inflation eases.
Central banks gain room to hold or cut interest rates. Governments spend less on fuel subsidies and redirect those funds toward health, education, and infrastructure. For a country like Uganda, where fuel costs shape the price of food on every market stall, this matters in concrete, daily ways.
J.P. Morgan analysts project Brent crude averaging $86 per barrel in Q3 and $80 in Q4. Prices could even test $65 per barrel in the coming weeks before stabilising. That trajectory, if it holds, gives developing economies several months of favourable conditions to consolidate their fiscal positions and rebuild reserves.
The risks are real, however. Geopolitical negotiations between the US and Iran remain unresolved. Any breakdown in the current 60-day process could reignite market anxiety instantly. Production adjustments by major exporters could tighten supply faster than analysts expect. The relief at the pump today is genuine. It may not be permanent.
The lesson is clear: prepare in the good times for the bad ones that always follow.
