Brent crude has surged from $70 to $80 per barrel within a week, driven by escalating concerns over the Israel-Iran conflict, which threatens to disrupt crude supplies from the Middle East. Goldman Sachs predicts that Brent prices could reach $90 in the coming days as the situation unfolds.
Oil Market Price Movements
The rise in global oil prices continued on Monday, building on last week’s gains:
West Texas Intermediate (WTI) crude for November delivery rose by $1.57, or 2.1%, reaching $75.95 per barrel on the New York Mercantile Exchange.
Brent crude, the global benchmark, increased by $1.19, or 1.5%, to $79.24 per barrel on ICE Futures Europe, peaking at $79.94 earlier in the session.
Diesel Price Surge in Nigerian Depots
In Nigeria, diesel prices have spiked at depots as the cost of Automotive Gas Oil (AGO) saw a notable rise on 7 October 2024:
Nipco: ₦1,105 (up from ₦1,075 on 4 October)
Ibachem: ₦1,150 (up from ₦1,070)
Wosbab: ₦1,150 (up from ₦1,070)
Additional depot prices:
First Royal: ₦1,100 (up from ₦1,064)
Rahamaniyya: ₦1,100 (up from ₦1,057)
Contributing Factors to the Price Hike
Several key factors are contributing to the rise in diesel prices:
The dollar-to-naira exchange rate.
Increased logistics costs, including shipping, port, and NIMASA charges.
Higher depot expenses, particularly transportation and handling costs.
Marketers adding higher margins to cover rising expenses, further pushing up retail prices at fuel stations.
These combined factors have contributed to higher diesel prices, which are expected to put more pressure on consumers and businesses that rely heavily on the fuel for operations.