The global price of Brent crude dropped to $68.12 per barrel on Tuesday, falling below Nigeria’s 2025 budget benchmark of $75 per barrel.
The 3.40 per cent decline from Monday’s $71 per barrel was mirrored by a similar fall in the U.S. West Texas Intermediate (WTI), which dropped by 2.76 per cent to \$66.62 per barrel.
According to Reuters, the price drop followed news of a ceasefire agreement between Israel and Iran, brokered by former U.S. President Donald Trump. The development eased concerns over possible supply disruptions from the Middle East.
Trump announced the ceasefire on his Truth Social platform, stating, “Officially, Iran will start the ceasefire and, upon the 12th hour, Israel will start the ceasefire and, upon the 24th hour, an official end to the 12-day war will be saluted by the world.”
However, the ceasefire has faced setbacks. While Iran denied breaching the agreement, Israel accused Tehran of violating its terms and launched fresh strikes.
The falling oil price adds pressure to Nigeria’s fiscal projections for 2025, which are based on a $75 per barrel benchmark.
Earlier this month, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) reported a decline in the country’s oil output, stating that daily production dropped to 1,452,941 barrels in May.
Despite the production decline, the Organisation of Petroleum Exporting Countries (OPEC) confirmed on June 16 that Nigeria remained Africa’s top crude oil producer for the month.
