Crude oil prices are poised to surpass $80 per barrel following rising tensions in the Middle East, sparked by joint U.S.-Israeli strikes on Iranian nuclear facilities.
This geopolitical crisis has jolted the global energy market, raising concerns over fuel costs in countries like Nigeria, where petrol prices could hit N1,000 per litre soon. The attacks, described by U.S. President Donald Trump as having “obliterated” critical nuclear infrastructure, marked a significant escalation that has put Iran, a key OPEC producer, on a collision course with the West.
In response to the strikes, Iran’s parliament has reportedly moved to block the Strait of Hormuz, a vital passage for nearly a fifth of global oil shipments. Although the closure isn’t final, the mere threat has driven oil prices higher, with Brent crude gaining in early trading. Experts warn that if Brent crosses the $80 mark, domestic petrol prices in Nigeria could rise sharply, adding to the economic strain of volatile foreign exchange rates.
Energy stakeholders have sounded the alarm over possible price hikes. Olatide Jeremiah, head of PetroleumPrice.ng, predicted that private depots could start charging up to N1,000 per litre soon if crude prices continue their upward climb. He emphasized the pivotal role of the Dangote refinery in stabilizing prices, noting, “If Dangote maintains its current rate, we might avoid extreme depot markups. But any supply gap could drive prices higher.”
Marketers across the country have already adjusted their pump prices in response to the rising cost of crude and foreign exchange volatility. Over the weekend, prices at filling stations rose sharply, with rates ranging from N925 in Lagos to nearly N1,000 in parts of the North.
Chinedu Ukadike of IPMAN attributed these increases to global crude market instability, highlighting that petrol refined locally by Dangote is still vulnerable to international price shocks because it buys crude at prevailing market rates.
Reports show that key Nigerian crude grades like Bonny Light and Qua Iboe have hovered around $79 per barrel, exceeding the Federal Government’s 2025 benchmark of $75. While this might offer temporary fiscal relief, the higher crude costs are translating directly into more expensive petrol at the pump. Depot owners have responded by raising ex-depot prices, with many now above N900 per litre.
Analysts worldwide are bracing for more volatility. Brent crude and WTI have seen double-digit percentage gains since the conflict reignited, with markets pricing in heightened geopolitical risks. However, experts caution that the ultimate impact on oil prices will depend on whether the conflict escalates further or supply disruptions occur. UBS analyst Giovanni Staunovo noted, “Prices will likely rise if supply is interrupted, but could stabilize if tensions ease.”
Meanwhile, uncertainty looms over Iran’s next steps regarding the Strait of Hormuz. While reports suggest a parliamentary push to close the waterway, the final decision rests with the country’s Supreme National Security Council. With about 20% of the world’s oil passing through this narrow corridor, any disruption would have profound implications for global energy supplies and pricing.
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