The price of Nigeria’s Bonny Light crude oil registered an increase yesterday, reaching $77.75/bbl from its previous average of $73/bbl last Friday.
This upward movement is observed amidst the ongoing conflict between Israel and Iran.
The global oil market demonstrated a notable response to these hostilities, particularly following reported damage to facilities at Iran’s Pilot Fuel Enrichment Plant.
This development has escalated concerns regarding potential disruptions to worldwide oil and gas supplies.
Other crude benchmarks also experienced price increases but have since dropped since US President Trump urged for peace in the Middle East.
While Nigeria’s rising Bonny Light currently sells at a significant premium, popular benchmarks have seen a fall in the last 24 hours.
As of this morning by 6am (GMT+1);
- ICE Brent: $69.47/bbl, falls 2.81%
- WTI: $66.53/bbl, falls 2.89%
The oil marjet responded swiftly to speculation that tensions have or would ease in the short-lived military altercations between Jerusalem and Tehran.
Experts had said crude oil prices could potentially escalate towards $100/bbl should the Israel-Iran conflict intensify, but that doesn’t seem to be happening. At least for now. Mind you, Gaza is still on.
The projection was largely attributed to Iran’s significant role as a major oil- and gas-producing nation and a member of the Organization of the Petroleum Exporting Countries (OPEC).
OPEC and its allies control over 30% of global oil supplies. Some of its major suppliers are in the Persian Gulf.
More so, Iran had threatened to shut the Strait of Hormuz; a vital choke point through which some 15-20% of the world’s petroleum supplies pass daily.
Energy experts had also indicated that such a surge in prices would favorably impact the execution of Nigeria’s N54.99 tn 2025 budget. That is not completely out of place yet.
The budget is predicated on an oil benchmark of $75 /bbl, a daily output of 2.06 mmb/d and an exchange rate of N1,500 to the dollar.
Meanwhile, latest OPEC report Nigeria’s crude oil output, excluding condensate, at 1.544 mmb/d for May 2025.
This figure represents a marginal increase of 1.44% compared to the 1.522 mmb/d recorded in April 2025.
OPEC’s June 2025 Monthly Oil Market Report (MOMR) indicated that these statistics were compiled from secondary sources.
Commenting on the Middle East crisis, Dr. Muda Yusuf, Director and CEO of the Centre for the Promotion of Private Enterprise (CPPE), stated that:
“The spikes will likely lead to higher prices for petroleum products such as petrol, diesel, jet fuel, and gas globally, with significant consequences for households, businesses, and national inflation.”
He further explained, “Higher energy prices affect production, logistics, transportation, and power generation. These increased costs will eventually be passed on to consumers, depending on the elasticity of demand.”
Little wonder why Dangote has recently increased its ex depot petrol price by N55, from N828 to N880/litre.
Dr. Yusuf concluded, “Global energy price hikes have inflationary consequences worldwide. Therefore, Nigeria could experience additional inflationary pressures from this external shock.”
On his part, Mr. Tunji Oyebanji, Managing Director of 11Plc (formerly Mobil Oil) said “The conflict is volatile and the global market would continue to react to it.”
It remains to be seen in the coming days whether this statement will or will not hold sway.