EXPLAINED: Why Global Oil Prices Rose in Early September 2026

Global oil prices have risen amid renewed U.S.-Iran tensions, with Murban crude increasing 5.2% over the week, according to the Central Bank of Kenya (CBK).

According to the CBK Weekly Bulletin issued on September 4, 2026, Murban crude oil prices climbed to USD 86.01 per barrel on September 3, from USD 81.78 per barrel on August 27.

“Murban crude oil prices rose to USD 86.01 per barrel on September 3, up from USD 81.78 per barrel on August 27, reflecting rising concerns about oil supply risks following renewed U.S.-Iran tensions,” CBK said.

The increase amounted to USD 4.23 per barrel in one week, reflecting growing sensitivity in the energy market to geopolitical developments.

Oil Prices Rise as Supply Risks Mount

Renewed tensions between Washington and Tehran have heightened concerns over the security of global supplies, helping drive the latest movement in oil prices.

Beyond the energy market, CBK warned that inflation risks remained elevated across advanced economies.

Euro area inflation rose to 3.3% in August 2026 from 2.9 percent in July, with higher energy costs contributing significantly to the increase.

“Inflation risks have persisted and remain elevated in advanced economies,” CBK stated.

Also Read: CBK Reveals Banks With Lowest Interest Rates as of July 2026

Among the major euro area economies, Spain recorded inflation of 4.5% in August, followed by Italy at 3.2 percent, Germany at 2.9 percent and France at 2.7%.

Higher Oil Prices Put Kenya’s Import Costs in Focus

For Kenya, a prolonged increase in oil prices could raise the cost of petroleum imports and place pressure on businesses and consumers.

The country depends on imported petroleum products, making movements in international oil prices an important factor in the cost of transport, production and other economic activities.

Despite the latest increase, the Kenya Shilling remained stable against the U.S. dollar. CBK reported that the currency traded at Ksh 129.48 to the dollar on September 3, compared with Ksh 129.47 on August 27.

This stability could help shield importers from additional foreign-exchange costs. However, continued increases in crude oil prices could still push Kenya’s petroleum import bill higher.

Meanwhile, foreign exchange reserves stood at USD 14.882 billion as of September 3, equivalent to 6.1 months of import cover. The figure remained above CBK’s statutory requirement of at least four months of import cover.

Also Read: CBK Announces Interest Rate Decision Amid Rising Global Inflation

Kenya Inflation Edges Higher

At home, consumer prices also recorded a modest increase during August.

CBK reported that headline inflation rose to 6.6% from 6.5% in July, largely because core inflation increased.

Core inflation moved up to 3.4% from 3.2%, mainly due to higher prices of beef with bones and fresh packeted cow milk.

Conversely, non-core inflation moderated to 14.7% from 15 percent.

“Headline inflation increased marginally to 6.6%  in August 2026 from 6.5 percent in July 2026,” the bulletin stated.

With global energy markets facing renewed supply concerns, higher oil prices could create additional pressure on Kenya’s import costs if the trend persists.

The impact on motorists and consumers, however, will depend on how international crude movements feed through to domestic petroleum prices.

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CBK Governor Kamau Thugge appears before the parliamentary committee at Bunge Towers on July 30 to address concerns over CBK’s proposed banking fees. PHOTO/ Parliament of Kenya Facebook