Threats to the Strait of Hormuz and the Iran-US-Israel conflict have caused Nigerian crude to surge above $110 per barrel.
Brent reached its highest point since mid-2022 at $112 per barrel by week’s end.
This is significantly higher than Nigeria’s $64.85 budget benchmark.
Brent crude prices have risen over 50% this month, and Middle Eastern oil such as Abu Dhabi’s Murban grade has doubled in value.
The global benchmark of Brent has increased nearly 50% this month as the third week of the conflict approaches.
Latest Market action shows a sustained close above $108 could signal a blow-off top toward the 2022 highs of $120 a barrel. Light sweet grades like Bonny Light and Qua Iboe, due to their low sulfur content, are trading at a premium; recently, Bonny Light reached about $112 a barrel.
However, Africa’s most populous economy continues to struggle meeting its OPEC quota of 1.5 million barrels per day, with data from February 2026 showing a drop to 1.31-million-barrel per day (crude only).
The hike underscores the continued vulnerability of Nigeria’s fuel market to international crude oil price volatility and supply chain disruptions, despite the coming on stream of the Dangote refinery, which was expected to stabilize domestic supply.
Transportation fares and commodity prices are likely to rise in response to the most recent increase, which is anticipated to set off a new wave of pump price adjustments across the nation. Several African governments have started aggressively reaching out to the 650,000-barrel-per-day facility amid a surge in demand.
South Africa, Ghana, and Kenya have formally contacted Dangote refinery, and several more are making inquiries as disruptions related to the Iran war continue to stifle global fuel supply chains. The US has authorized the sale of Iranian oil and petrochemicals loaded onto tankers as part of its recent effort to mitigate rising oil prices caused by the Middle East conflict.
U.S government suspends sanctions on Iranian oil
The Department of the Treasury issued a general license for energy already onboard vessels, authorizing these purchases through April 19.
This move follows similar actions concerning Russian oil at sea, aimed at easing an unprecedented fuel supply shortage triggered by the conflict. Chinese consumers now buy most of Iran’s oil, mainly from independent refiners known as “teapots.”
- New buyers would face challenges in structuring transactions due to Iran’s ongoing restrictions, though the US waiver could expand the pool of potential buyers by allowing access to international financial markets.
- Only a few Iranian and Chinese tankers pass through the Strait of Hormuz, where 20% of the world’s oil typically flows, due to the US and Israeli conflict with Iran.
- Major OPEC producers are forced to cut output because Hormuz is nearly closed, leaving supplies stranded in the Persian Gulf. Israeli Prime Minister Benjamin Netanyahu has vowed not to attack Iran’s energy facilities, while Iran has continued attacks on neighboring Gulf countries.
Meanwhile, Trump has attempted to de-escalate attacks on natural gas and oil resources, again criticizing NATO allies for refusing to join the war effort against Iran or help clear the strait through which 20% of the world’s oil passes.
