Brent crude extended its losing streak on Monday, plunging nearly 4% in a single day to settle at $67.66 per barrel, as traders positioned ahead of fresh supply signals from OPEC+ and the return of Kurdish oil exports. The sharp decline underscores growing fears that the oil market could tip into oversupply just as demand eases with the close of the peak summer season.
OPEC+ Looms Over Market Sentiment
The OPEC+ alliance is scheduled to meet on 5 October, where ministers are expected to approve another production hike of 137,000 barrels per day (bpd) in November. This would follow an identical increase already set for October, part of a gradual reversal of the group’s 1.65 million bpd output cuts.
Although not all members have the capacity to deliver their full quotas, the group’s signalling of higher supply has been enough to shake confidence and push prices lower. Traders see the move as a clear warning that OPEC+ intends to prevent the market from tightening too quickly.
Kurdish Oil Flows Weigh on Prices
The resumption of crude exports from Iraq’s Kurdistan region has added further downward pressure. Around 230,000 bpd is now flowing to Turkey after a two-and-a-half-year halt, boosting near-term supply at a time when refiners are already cutting back purchases.
Brent Crude’s Technical Slide
Monday’s decline of 3.53% dragged Brent to its lowest level in weeks, erasing the gains made when prices briefly touched the $70 handle late last week. Market analysts warn that if Brent fails to hold above the $67 threshold, further losses could test the mid-$60 range.
Nigeria Faces Fiscal Strain
For Nigeria, every dollar decline in Brent crude carries heavy implications. The 2025 budget is pegged at $77 per barrel, leaving a widening gap as prices slip deeper below target. The drop threatens foreign exchange earnings, complicates naira stability efforts, and raises questions over funding for infrastructure and social programmes.
Analysts warn that if Brent fails to rebound soon, Abuja will have to reassess its fiscal assumptions as shrinking revenues clash with rising debt service obligations.