Global oil prices remained steady on Monday, maintaining levels above Nigeria’s 2026 budget benchmark of $64.85 per barrel, as ongoing supply disruptions and escalating geopolitical tensions in the Middle East continued to support the market.
This information comes from market reports tracking Brent and U.S. crude futures reported by Reuters.
The resilience in prices provides some relief for Nigeria’s fiscal planning but also highlights ongoing risks.
Oil prices showed a slight decline early Monday, with Brent crude futures dipping by 7 cents, or 0.1 per cent, to $65.81 per barrel as of 02:21 GMT.
Meanwhile, U.S. West Texas Intermediate (WTI) crude eased by 6 cents, or 0.1 per cent, to $61.01 per barrel.
The small pullback followed a strong rally in the previous trading session, where prices surged over 2 per cent.
Both benchmarks posted weekly gains of approximately 2.7 per cent on Friday, closing at their highest points since mid-January.
Global oil markets remain pressured by supply tightness and geopolitical risks, pushing prices higher despite minor dips.
The trend is driven mainly by U.S. production losses and rising Middle East tensions.
These factors collectively add a risk premium to oil prices, underpinning the recent gains despite minor pullbacks.
Nigeria’s oil-dependent economy heavily relies on stable crude prices to fund its budget and manage foreign exchange earnings.
The country’s 2026 budget was set with an oil price benchmark of $64.85 per barrel and a production target of 2.6 million barrels per day (mbpd).
These assumptions are critical for revenue projections and fiscal sustainability.
Last week, prices briefly fell below the benchmark, raising concerns among policymakers and analysts about potential revenue shortfalls.
Historically, Nigeria’s oil sector has faced challenges such as pipeline vandalism, oil theft, and production inefficiencies, which often undermine its ability to meet production targets even when prices are favorable.
The current price stability above the benchmark offers a buffer but does not eliminate underlying risks to Nigeria’s fiscal outlook.
The current price stability above the benchmark offers a buffer but does not eliminate underlying risks to Nigeria’s fiscal outlook.
The recent price gains provide optimism, but challenges remain:
While the current oil price environment supports Nigeria’s fiscal assumptions, long-term stability depends on both external market conditions and internal production realities.
Earlier, Naijaonpoint reported that Nigeria’s fiscal deficit jumped to N13.51 trillion in 2024, exceeding targets and breaching the FRA 2007 deficit-to-GDP limit.