After reaching record lows of $16 a barrel in April, global crude oil benchmark, Brent crude, has seen a stable recovery around the $40 range this month.
The rising demand for brent crude was led by China, with its large appetite for oil, followed by Europe and North America. This shows a stable growing demand for crude in the coming months.
Global oil trader Vitol expects demand to rise by 1.4 million barrels a day in June. Meanwhile, Trafigura, another multinational oil trader, says that oil demand is back to 90% of levels before the Coronavirus pandemic crashed demands – a view that Saudi’s Aramco also supports.
The oil market is stabilising amidst compliance of OPEC+ members with the agreement to cut oil production.
Trafigura’s co-head of oil trading, Ben Luckock told Bloomberg, “At $40 a barrel, we can trade a few dollars higher and a few lower. But for the first time in a few months you can see a range. The market stability is here to stay. The physical market is strong.”
Last week, Nigeria’s Vice President, Yemi Osinbajo revealed in one of the Sustainability Committee’s reports that Nigeria is expected to earn N88.4 billion monthly at an average crude price of $30.
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The new oil stability around $40, which is above the sustainability committee’s benchmark, will help oil-dependent nations like Nigeria breathe a sigh of relief.