Oil prices have started the week sharply higher, with Brent crude climbing above $97 a barrel and moving closer to a three-month high.
The latest rally has been driven by growing tensions between the United States and Iran after both sides targeted vessels linked to each other, raising fresh concerns about possible disruptions to shipping through the strategically important Strait of Hormuz.
The renewed conflict has pushed international oil prices about 10% higher over the past month as markets reassess the risks to global crude supplies.
The Strait of Hormuz is a key global oil transit route, meaning any prolonged disruption could have a significant impact on international energy markets and fuel prices.
For South Africa, the rise in crude prices could place additional pressure on the country's fuel and inflation outlook.
Higher international oil prices typically translate into increased fuel costs, which can then push up transport expenses and the prices of other goods and services.
The developments could also complicate the South African Reserve Bank’s efforts to consider further interest rate cuts.
With fuel prices already a major factor in household and business costs, a sustained rise in oil prices could make it more difficult for inflation to remain under control.
Markets will now closely monitor developments between the US and Iran, as well as any signs of disruption to oil shipments through the Strait of Hormuz.