₦airaland Forum

Nigerian Crude Trades Above $70, Exceeds 2026 Budget Benchmark Amid Rising Geopolitical Tensions

By Queen Madaki

Nigerian crude oil is trading above $70 per barrel, exceeding the Federal Government’s 2026 budget benchmark of $64.85, as geopolitical tensions and global supply risks continue to support prices.

Latest market data shows Bonny Light trading at approximately $71 per barrel, slightly down from $72.3 recorded on Monday. Despite the marginal pullback, prices remain comfortably above Nigeria’s fiscal planning assumption, providing potential upside for revenue projections.

This development forms part of broader global energy movements closely monitored under Nigeria News Today and reflects a market balancing geopolitical risk premiums against medium-term supply growth expectations.

Geopolitical Risk Supports Oil Prices

Oil has emerged as one of the best-performing asset classes this year amid heightened geopolitical uncertainty.

US military activity around the Red Sea ahead of renewed US-Iran nuclear talks in Geneva has increased market sensitivity to potential supply disruptions. Iranian naval exercises in the Strait of Hormuz — a critical route that handles roughly 20 million barrels of oil daily — have further elevated risk premiums.

Any disruption in that corridor could significantly impact global crude flows, tightening supply in the short term.

Supply Outlook Signals Medium-Term Balance

While geopolitical tensions support near-term prices, medium-term supply projections suggest a more balanced market.

The US Energy Information Administration (EIA) forecasts that global oil inventories will increase by an average of 3.1 million barrels per day this year, as production growth is expected to outpace consumption.

If realised, this build-up in stockpiles could moderate prices later in the year, particularly if global demand softens amid renewed trade uncertainties.

Fresh concerns have emerged after the US administration signalled plans to introduce new national security tariffs, including a proposed 15% global tariff, raising fears of slower global growth and reduced energy demand.

Market participants are also awaiting the release of the American Petroleum Institute (API) weekly crude inventory data for short-term directional signals.

Nigeria’s Budget Outlook Strengthened

The Federal Government’s 2026 budget is based on a conservative crude price assumption of $64.85 per barrel and a production target of 1.84 million barrels per day.

With Nigerian crude trading above benchmark levels, fiscal buffers could improve if prices remain elevated.

Production in January 2025 stood at approximately 1.48 million barrels per day, slightly below Nigeria’s OPEC+ quota of 1.5 million barrels per day.

Structural Improvements in the Oil Sector

Nigeria’s oil outlook has shown signs of structural improvement in recent months.

1. Nigeria launched the Cawthorne crude grade (API 36.4°) in February 2026.

2. Earlier introductions of Utapate (2024) and Obodo (2025) have diversified export offerings.

3. The Dangote Refinery, with capacity exceeding 650,000 barrels per day, has significantly altered domestic refining dynamics.

During a recent site visit by NNPCL officials, the Dangote Refinery was reported to be operating at 661,000 barrels per day — above its designed capacity.

The refinery now supplies between 60 and 65 million litres of petrol daily to the domestic market and exports approximately 20 million litres of surplus product, reducing Nigeria’s historical dependence on imported refined fuel.

Security Gains and Investment Drive

Crude theft and pipeline vandalism had cost Nigeria billions in lost revenue in recent years. However, the 2025/2026 period recorded the first decline in reported losses in 16 years, supported by enhanced security task forces and community-based surveillance systems.

In January 2026, the Federal Government launched a licensing round covering 50 oil and gas blocks, targeting over $10 billion in new investment across undeveloped and intracontinental basins.

As oil prices remain above budget assumptions, Nigeria’s fiscal performance will depend on sustaining production growth while navigating global supply-demand uncertainties.

This energy market analysis is published by The Business Bureau as part of its ongoing Nigeria News Today coverage.

Source: The Business Bureau

Na because of US-Iran Tension.
Abeg, make the Tension continue

I know APC data boys would be happy.

But there is a problem

Most of the windfall would be used to settle debt. That is the life of an oil dependent country.

Plus IT IS NOT ENOUGH....for Nigeria to earn enough money from oyel...Nigeria needs oyel to be at 150 dollars per barrel...for a sustained period of time.

So, make we no decieve ourselves.

FInally, high oil prices means govenrment would just hook the economy even more to oil. No diversification, no innovation, no industry.

(Why did Ghaddafi lose to the west? Because he used high revenue from oyel money to buy weapons from the same WEST. Equivalent to having the phillistines sharpening your iron tools if you were ancient Israel).



Manufactured goods and services
Dutch disease.

Win win for us... sweet and nice

IF DANGOTE IS BUYING CRUDE IN DOLLARS, THEN EXPECT A HIKE IN PETROL PRICING.....EXCEPT HE IS BUYING IN NAIRA

This is a good development. The government should recline on the initial borrowing plan.

Don't mind them.... Any good news about Nigeria excites them as if they are the only patriotic people in Nigeria.
Maybe we need to find a way to teach them how to be happy only with bad news, what do you think?

nairalanda1:


I know APC data boys would be happy.


Dutch disease.

About to go higher.

Just watch.

The straight of Hormuz, them go use the money well so
We know them loot everywhere, even those that don't have single crude oil in their backyard are shouting too
Niger delta crude na national cake, osun gold na osun own, zamfara gold na for them oya come eat national cake why they Niger delta suffer

Leepeak:
The straight of Hormuz, them go use the money well so
We know them loot everywhere, even those that don't have single crude oil in their backyard are shouting too
Niger delta crude na national cake, osun gold na osun own, zamfara gold na for them oya come eat national cake why they Niger delta suffer

Even if we said osun and zamfara gold na every one own, IT STILL WON'T BE ENOUGH...because we do not set the price of any raw material or mineral we sell...and that includes GOLD.

The best way for nigeria to develop is to use its raw materials to make goods and services that are exportable. Not gold or oil sales.

nairalanda1:


I know APC data boys would be happy.

But there is a problem

Most of the windfall would be used to settle debt. That is the life of an oil dependent country.

Plus IT IS NOT ENOUGH....for Nigeria to earn enough money from oyel...Nigeria needs oyel to be at 150 dollars per barrel...for a sustained period of time.

So, make we no decieve ourselves.

FInally, high oil prices means govenrment would just hook the economy even more to oil. No diversification, no innovation, no industry.

(Why did Ghaddafi lose to the west? Because he used high revenue from oyel money to buy weapons from the same WEST. Equivalent to having the phillistines sharpening your iron tools if you were ancient Israel).



Manufactured goods and services
Dutch disease.

spewing trash as usual.

Your region that is solely dependent on FG handouts from same crude oil sales should not be making such noise.

And isn't the reason for your collective tantrums on the state of the economic reforms being that this administration has stopped defending the naira so as to reduce importation which your region ecomnomic model relies on?

Lol why are you all celebrating?

These monies will never get to the ordinary Nigerians. It won't strengthen the naira to 1k per dollar.

Even the oil well owners and their communities we not benefit. The only persons that will benefit from this news are our corrupt leaders and politicians.

The money will be shared between State governors and Federal Government headed by Tinubu.

Poor Nigerians will still go to bed hungry, fuel will still be 890, cement will keep increasing, cost of living will continue.

So why the celebration?

nairalanda1:
I know APC data boys would be happy.

But there is a problem

Most of the windfall would be used to settle debt. That is the life of an oil dependent country.
.

Someone is genuinely sad that the government will use the excess money to pay debt.

Is this delusion, self hate or witchcraft

wellmax:
Someone is genuinely sad that the government will use the excess money to pay debt.

Is this delusion, self hate or witchcraft

That generally means that the country may not see as much expected revenue from the price increase. It's kind of a common thing with being a oil dependent nation.

Then there is the fact that our breakeven price is around 150 dollars...which is the price we need the oil to produce a balanced budget. (Some put it at 85 dollars). Which isn't surprising as we have to use the revenue from 1.7-1.9 m bpd to 'feed' 230 million people...so the price increase isn't much anyway. We are still losing a potential 15 dollars per barrel at least in revenue.

FInally, needs still have to be met, and since debt is being settled with the excess fresh income, more debt may need to be taken on to pay for the money we didn't get from the windfall.

In extreme circumstances, we may have to accept a structural adjustment programme (SAP) from the IMF. As we did in 1986. That means things are so bad, we are just one step away from running outta money like Sri Lanka recently.

The point is, we have to stop keeping our economy hooked to oyel.

The same crude sold for more than $125 during Jonathan presidency, and the same government could not pay salaries not to talk of pension.

Most of it was looted by his supporters now cheering a packaged fraud today.

DomPerignon:
spewing trash as usual.

Your region that is solely dependent on FG handouts from same crude oil sales should not be making such noise.

And isn't the reason for your collective tantrums on the state of the economic reforms being that this administration has stopped defending the naira so as to reduce importation which your region ecomnomic model relies on?

Well, I am not from that region (nor am I from the North, or even tinubu region self)...but here is the reason for my sarcastic and amused post.

High oil prices in a country that derives most of its income from oil...while it sounds like good news on the outside...means several things

1. Oil prices have been very low for a long time. In 2025, oil prices were for most of the year way below our budget benchmark. To pay for the budget , the government had to increase borrowing , or else salaries won't have been paid in full...for months.

So, when oil prices go up, that means....that debt has to be paid back. And then...it leads to us taking on more debt.

2. One reason why oil sanctions don't affect Russia, for example...Russia produces more than oil, and it has a diversified economy...for export purposes.

Nigeria doesn't...and most of our government revenue is oil based (Taxes may increase their contribution to the revenue eventually...if the tax reforms work...but it is going to take some time). So, we are persistently vulnerable because our everything is based on oil prices...which rise and fall

3. Oil prices never stay as high as we want them to.


See my point? And it kind of annoys me that most nigerians can't see that.

Whenever there is an increase in Crude, I do not Know whether to jubilate or cry...
Most times, when there is an increase in Crude oil , the prices of PMS automatically increase, Which doesn't go down well will most of us...

The increase in Crude doesn't have any direct impact on the Masses.

nairalanda1:


I know APC data boys would be happy.

But there is a problem

Most of the windfall would be used to settle debt. That is the life of an oil dependent country.

Plus IT IS NOT ENOUGH....for Nigeria to earn enough money from oyel...Nigeria needs oyel to be at 150 dollars per barrel...for a sustained period of time.

So, make we no decieve ourselves.

FInally, high oil prices means govenrment would just hook the economy even more to oil. No diversification, no innovation, no industry.

(Why did Ghaddafi lose to the west? Because he used high revenue from oyel money to buy weapons from the same WEST. Equivalent to having the phillistines sharpening your iron tools if you were ancient Israel).



Manufactured goods and services
Dutch disease.

Thought you would be happy for once, since you are the one challenging us on this platform to empty our pockets for the government to enable them have more to loot.

Now they have got alternative means of indulging in their excesses, you are suddenly becoming unhappy because the new increment is not coming from the common man's sweat.

What has the masses done to you?

Enjoy it while you can. When de-amalgamation happens, South South is putting a stop to all these awoof nonsense for other regions.

;DBros both the dollar and oil are weakening. Oil won’t break the 70$ mark. Naira is currently giving dollar uncensored doggy woto woto. Na CBN governor call for break. But d viagra still de Naira body and e de beg dollar seriously to put just the tip. The is the beginning of economic interracial wonders.

dequir:
Thought you would be happy for once, since you are the one challenging us on this platform to empty our pockets for the government to enable them have more to loot.

Now they have got alternative means of indulging in their excesses, you are suddenly becoming unhappy because the new increment is not coming from the common man's sweat.

What has the masses done to you?

Well, at the end, the answer always has been...manufactured goods and services.

[quote author=saintopus post=138589437]This is a good development. The government should recline on the initial borrowing plan.[/quote
If they have not even borrowed.
U can not predict this contr3 ]

garykoeman:
The same crude sold for more than $125 during Jonathan presidency, and the same government could not pay salaries not to talk of pension.

Most of it was looted by his supporters now cheering a packaged fraud today.

The difficulties in paying salaries came around 2014...when oil prices started dropping....meaning government revenue was gone. We were there before ...in 1982. Oil prices dropped, and issues with payments arose..

Also, subsides. When oil prices were sky high at over 100 dollars per barrel..that meant that subsidy costs jump up drastically...that chops a lot of revenue and leaves limited amounts for other things.(That's why GEJ wanted to remove subsides in 2011, because the warning signs were there).

Pushback...how does high oil prices increase subsidy costs? Well, it means that when oil prices rise, the purchasing price of fuel rises. So, to keep fuel prices low, the government has to spend more. And then oil provides most of our revenue...so paying for subsides means that more of the revneue is spent on subsides...which is why when the oil prices fall...there are no savings even to keep on paying for stuff. That's why subsidy should have gone in 2011, or even earlier.

Finally, oil revenue was never high enough because of our high population. Someone like the current emir of Kano was pointing that out as early as 2012 when he was still CBN head honcho. That's why people have been shouting at government to diversify...which they haven't done, espeically this one.

nairalanda1:
The difficulties in paying salaries came around 2014...when oil prices started dropping....meaning government revenue was gone. We were there before ...in 1982. Oil prices dropped, and issues with payments arose..

Also, subsides. When oil prices were sky high at over 100 dollars per barrel..that meant that subsidy costs jump up drastically...that chops a lot of revenue and leaves limited amounts for other things.(That's why GEJ wanted to remove subsides in 2011, because the warning signs were there).

Pushback...how does high oil prices increase subsidy costs? Well, it means that when oil prices rise, the purchasing price of fuel rises. So, to keep fuel prices low, the government has to spend more. And then oil provides most of our revenue...so paying for subsides means that more of the revneue is spent on subsides...which is why when the oil prices fall...there are no savings even to keep on paying for stuff. That's why subsidy should have gone in 2011, or even earlier.

Finally, oil revenue was never high enough because of our high population. Someone like the current emir of Kano was pointing that out as early as 2012 when he was still CBN head honcho. That's why people have been shouting at government to diversify...which they haven't done, espeically this one.

ogodomigodoism. Ride on.

saintopus:
This is a good development. The government should recline on the initial borrowing plan.

Na, the government still has to borrow

1.It's too early to see if the oil price would remain high for a sustained period of time...that means months, and years even, not a few weeks or days

2.We still have to pay off debts. Much of the new revenue earned has to go to debt payment. And we also have to save...so as to avoid what happened in 2023 when we nearly ran out of money and were forced into the drastic devaluation of the naira and subsidy removal to cover our shame

3. OIl at 70 dollars is not high enough for nigeria. Even if it remained this way for a year, it just means borrowing MIGHT reduce, not reduce , and not by much.

That's why you guys have to vote for someone who has diversificaiton of the economy at the top of their agenda. And why more of us have to pay tax , let's be serious.

CodeTemplarr:
ogodomigodoism. Ride on.

Thank you and have a nice day...

If we have chosen the position in life in which we can most of all work for mankind, no burdens can bow us down, because they are sacrifices for the benefit of all; then we shall experience no petty, limited, selfish joy, but our happiness will belong to millions, our deeds will live on quietly but perpetually at work, and over our ashes will be shed the hot tears of noble people

Adieu