Rising tensions in the Middle East could offer Cameroon a budget boost, though one that remains uncertain. In an analysis of the economic impact of the conflict involving Iran, the Ministry of Finance says sustained high oil prices would significantly support public revenues in 2026.
According to the report, if oil prices average $100 per barrel throughout 2026, additional oil revenue could reach around CFA180 billion compared with assumptions in the budget law. This increase would come mainly from royalties paid by the National Hydrocarbons Company (SNH) and corporate taxes from oil companies.
The projection comes as oil markets react sharply to growing geopolitical risks around Iran. Prices began rising even before recent military operations. Brent crude moved from $71 to $73 per barrel in one day, then climbed to $81.8 on March 3, 2026, before crossing $90 on March 6.
Several analysts now expect prices to range between $90 and $100. In the event of prolonged supply disruptions or attacks on energy infrastructure, a spike to $150 is not ruled out.
For Cameroon, a crude exporter, the immediate effect is clear: higher prices lead to higher oil revenues. In the short term, the government stands to gain additional income. On paper, the external shock may offer some relief to public finances under pressure.
The limits of the oil windfall
However, this potential gain comes with trade-offs. The Ministry of Finance warns that fuel subsidies would also rise, though at a slower pace than oil revenues.
This reflects a structural constraint. Cameroon produces crude oil but imports refined fuel. As a result, higher global prices increase both export revenues and the cost of energy imports. What the government gains on one side may be partly offset on the other.
Recent data highlight this vulnerability. After rising 48.4% in 2021 to CFA1,223 billion and 75.6% in 2022 to CFA2,147 billion, hydrocarbon exports fell back to CFA1,056 billion in 2025. Oil royalties declined from CFA774.5 billion in 2022 to CFA530 billion in 2024, while corporate tax from oil companies reached CFA254.2 billion in 2023, compared with CFA73.2 billion in 2021.
At the same time, the cost of fuel imports has increased sharply. It peaked at CFA1,128 billion in 2023 before falling to CFA788 billion in 2025 as global prices eased. Part of this burden has been absorbed by the state, with fuel subsidies reaching CFA460 billion in 2023 and CFA231 billion in 2024, despite two increases in pump prices.
A broader inflation risk
Beyond public finances, the ministry points to a wider risk: the transmission of higher energy costs across the economy. “When energy and shipping costs rise, the impact spreads across the entire value chain,” the report notes, warning that higher import prices could feed into domestic inflation.
The implications go beyond fiscal balances. A new surge in oil prices could weaken household purchasing power and raise production costs for businesses. In other words, the short-term revenue gains may be offset by broader economic pressures.
The ministry’s analysis highlights a more complex reality. A $100 oil price could generate significant additional revenue for Cameroon, but the benefit would not be fully net. It would be partly absorbed by higher subsidies, rising import costs, and spillover effects on domestic prices.
In an economy exposed to swings in global oil markets, the key issue is not just the price of oil. It is whether the government can turn a temporary windfall into a lasting fiscal advantage without letting external shocks spread through the wider economy.
Amina Malloum
