Oil above $100: what could happen to gasoline and inflation in Latin America

Oil above $100: what could happen to gasoline and inflation in Latin America

Summary of the event

Oil prices rose sharply. A barrel of Brent, the benchmark price in Europe, gained more than 5% and reached $107, its highest level since May. West Texas, the benchmark in the United States, recovered $101. The cause is the war between the United States and Iran, still unresolved. The figures come from Expansión and El País.

Oil supply also fell. Saudi Arabia produced 6.2 million barrels per day in August, its lowest of 2026 and 23% less than in July. OPEC production fell 640,000 barrels per day, according to Reuters. The Houthis, allies of Iran, took the Yemeni port of Mocha and threaten the Red Sea. Passage through Hormuz is still restricted and attacks on oil tankers have increased. Oil has risen nearly 40% since the war began.

What it means

Oil is the raw material for gasoline and diesel: if it rises, so does the cost of moving everything. Inflation is a general rise in prices. When energy pushes it up, central banks raise their interest rate, the price of borrowing money. This cools the economy, but credit becomes expensive.

Latin America is hit harder, because gasoline weighs heavily on family budgets. Brazil already shows this: the dollar moved around 5.10 reais and the stock market fell. The government has already spent about 37,500 million reais on measures to contain gasoline, with lower taxes, a diesel subsidy and Petrobras reversing a rise of 0.19 reais per liter.

A bond is a loan that investors make to a government. The 30-year United States Treasury bond reached 5.35%, its highest level since 2007, and the 10-year bond went above 4.9%. That makes debt more expensive.

Traders put the probability that the Federal Reserve, the central bank of the United States, will raise its rate on September 16 at about 70%. The European Central Bank already raised its rates on September 10.

Julius Baer says the fear of scarcity clashes with the market's "surprisingly stable" operation, because world reserves remain solid, and concludes that prices pay an "exceptionally high risk premium", an extra charge for the fear that oil may run short. ING stresses that China, the world's largest oil importer, increased its purchases and that could amplify any supply cut.

What could happen

No one can know the future. What follows are possibilities, not predictions.

Scenario one: if traffic through Hormuz stays restricted and attacks on tankers continue, crude could stay above $100. Gasoline would stay expensive and subsidies would cost more.

Scenario two: if the war is defused and passage through Hormuz and the Red Sea returns to normal, supply would flow again. The price could ease and relieve gasoline and inflation in the region.

Scenario three: if the Federal Reserve raises its rate on September 16 and Saudi Arabia keeps production low, the dollar could strengthen and make the oil the region buys more expensive.

What to watch

• Traffic through the Strait of Hormuz.
• Saudi Arabia's monthly production.
• The United States inflation figure.
• The Federal Reserve decision on September 16.
• China's oil purchases.

Sources: Expansión, Gestión and El País (Spain and Peru), Financial Times and Bloomberg (United States), Valor Econômico and O Globo (Brazil). September 10, 2026.