Oil prices have dropped as global tensions in the Middle East and Ukraine show signs of cooling down. As of Thursday, Brent crude is selling at $74.96 per barrel (-0.29%), while WTI crude is now $71.30 per barrel (-0.10%). Murban crude also fell to $76.95 per barrel (-0.76%), while natural gas surprisingly jumped by 4.46%, reaching $3.724.
What’s Causing the Drop?
Two major events are behind this price decline:
- Middle East Ceasefire Holding: Hamas has reaffirmed its commitment to a truce with Israel and plans to release more hostages. This has reduced fears of a full-blown conflict that could disrupt oil supply routes.
- Possible Peace Talks in Ukraine: U.S. President Donald Trump announced that both Russian President Vladimir Putin and Ukrainian President Volodymyr Zelensky are open to peace negotiations. If this happens, global markets will stabilise, reducing fears of supply disruptions.
How Does This Affect Nigeria?
As an oil-producing country, Nigeria makes most of its money from crude oil exports. When oil prices drop, the country earns less, which can affect the economy, government spending, and even the exchange rate.
However, there’s another side to this. Lower crude oil prices could mean cheaper petrol. Nigerians are currently paying between ₦925 and ₦945 per litre, so any reduction in landing costs could bring relief at the pump.
But here’s the issue Nigeria still imports huge amounts of its petrol despite the impact of Dangote refinery. Since forex and international refining costs play a huge role in fuel pricing, we may not see an immediate drop in pump prices.
What’s Next?
Experts believe oil prices may continue to fluctuate depending on how global politics unfold. If peace talks progress, prices could dip even lower. However, any fresh conflict especially in the Middle East could send oil prices soaring again.
For now, Nigerians can only hope that this drop in crude oil prices will soon reflect in petrol prices, easing the burden on transport fares, businesses, and household budgets. Until then, it’s a waiting game at the fuel stations.