- Nigeria’s Bonny Light rose to $78.62 per barrel, surpassing the country’s 2025 budget benchmark and offering short-term fiscal relief.
- Analysts warn of potential fuel price hikes as geopolitical risks, not supply shifts, drive global oil market volatility.
Nigeria’s major crude oil grades, Bonny Light, Brass River, and Qua Iboe, rose above $77 per barrel on Friday, June 13 and maintained those gains through Sunday. This was driven by Israel’s military strikes on Iran, which intensified fears of a broader Middle East conflict.
Data from Oilprice.com on Sunday, June 15, showed Bonny Light jumping to $78.62 per barrel, while Brass River and Qua Iboe closed at $77.09 and $77.14, respectively. These figures represent a sharp increase from the average of $65 per barrel recorded just days earlier. As a result, current prices now exceed the Federal Government’s 2025 budget benchmark of $75 per barrel by over $2, offering potential short-term fiscal relief.
Despite this boost, energy analysts have raised concerns about possible knock-on effects. They warned that sustained high crude prices could push local fuel prices, as refiners deal with more expensive crude, the primary input for petrol and diesel production.
Oilprice.com attributed the price spike to escalating geopolitical tensions in the Middle East. “The platform observed that the geopolitical risk premium is back,” noting that Brent futures rose to $74.23 per barrel and WTI to $73. The surge reflects growing expectations of a prolonged conflict between Israel and Iran and fears of disruptions to critical oil supply routes.
Although Israel’s strikes did not target oil infrastructure directly, the market reacted to the looming threat of Iran’s retaliation, which eventually materialised on Friday, June 13. As a precaution, Israel shut down some gas production facilities before the weekend. Meanwhile, concerns continue to mount over the safety of Red Sea shipping lanes and the strategically vital Strait of Hormuz.
The Strait of Hormuz, which handles an estimated 19 million barrels of oil and petroleum products daily, about one-fifth of global consumption, remains a key vulnerability. Analysts warn that any disruption in this corridor could increase oil prices, further tightening global energy markets.
It is important to recall that global crude prices had plunged to around $60 per barrel in February and March due to trade tensions sparked by former U.S. President Donald Trump’s tariff measures. In contrast, the current price surge stems more from geopolitical conflict risks than from market fundamentals or production adjustments by OPEC+.