Global crude oil prices extended their decline on Friday after fresh data showed an increase in oil drilling activity in the United States, raising expectations of stronger supply from the world's largest oil producer.
As at the time of writing 7:44 pm (WAT), Brent crude, the international benchmark, traded at $93.06 per barrel, down 2.07 per cent, while West Texas Intermediate (WTI) crude fell 2.64 per cent to $90.58 per barrel. The latest decline pushed both benchmarks further away from the highs recorded during the recent Middle East supply disruption.
The pressure on prices came as oilfield services company Baker Hughes reported that the number of active oil and gas rigs in the United States increased by four to 563 this week compared to the same period last year. Oil rigs, which serve as an indicator of future production levels, rose by two to 431. Although that figure remains below last year's level, the increase signals that producers are gradually responding to market opportunities despite price volatility.
Additional data from the U.S. Energy Information Administration showed crude oil production averaged 13.707 million barrels per day during the week ending May 29. While production slipped slightly from the previous week, output remained nearly 300,000 barrels per day higher than a year ago, reinforcing confidence that American supply remains resilient despite ongoing geopolitical tensions.
The decline in crude prices also reflects growing market attention on supply fundamentals rather than conflict-driven fears. Recent concerns over disruptions in the Middle East had pushed prices sharply higher, but traders are now weighing increased U.S. production capacity, additional drilling activity and slowing fuel demand growth in several major economies. These factors have combined to ease fears of an immediate supply shortage.
For Nigeria, the drop in international oil prices presents a mixed outlook. While lower crude prices could offer some relief to fuel import costs and ease pressure on local petroleum product prices, sustained weakness in the market may reduce government oil revenue projections, especially at a time when crude exports remain a major source of foreign exchange earnings. Market participants are expected to closely monitor developments in U.S. production and global demand trends in the coming weeks as they assess the next direction for oil prices.