₦airaland Forum

US-Iran war: FG earns N5tn oil windfall amid rising fuel hardship
May 3, 2026 12:00 am
Demonstration Held Outside White House Against Trump’s War In Iran
WASHINGTON, DC - APRIL 07: Anti-war demonstrators hold signs as they gather near the White House to protest the war in Iran on April 7, 2026 in Washington, DC. U.S. President Donald Trump announced that a temporary ceasefire has been reached between the U.S., Iran, and Israel, pausing attacks for about two weeks while Iran reopens the Strait of Hormuz and negotiations continue toward a longer-term agreement. Alex Wong/Getty Images/AFP (Photo by ALEX WONG / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)

By
Dare Olawin
Kindly share this story:



Nigeria’s oil earnings have recorded an estimated windfall of about N5.13tn in two months, as crude prices surged sharply following tensions linked to the United States–Iran crisis, pushing revenues far above the Federal Government’s 2026 budget assumptions.

The US-Iran war started on February 28 when oil prices were below $70 a barrel.

Since the war started, oil prices have continued to soar, selling for above $120 at some point. As of Friday, Brent traded at $110 per barrel, and Bonny Light, Nigeria’s flagship crude, traded at $134 as of Thursday.

The 2026 budget is anchored on daily oil production of 1.8 million barrels per day, a benchmark oil price of $64.85 per barrel and an exchange rate of N1,400 to the dollar.

Based on these, expected daily oil revenue stands at $116.73m, derived from multiplying 1.8 million barrels by $64.85. When converted at the budget exchange rate, this amounts to about N163.42bn per day, which serves as the baseline for measuring any revenue gains or shortfalls.

Findings, however, show that actual earnings in March and April exceeded this benchmark, largely due to a sharp rise in crude oil prices as the crisis in the Middle East rages on.

In March, data from the Nigerian Upstream Petroleum Regulatory Commission indicated that Nigeria’s oil production averaged 1.55 million barrels per day, while the average crude price stood at $95.03 per barrel, according to the Central Bank of Nigeria, and the exchange rate averaged N1,370 to the dollar.

Using these figures, daily revenue amounted to approximately $147.30m, obtained by multiplying 1.55 million barrels by $95.03.

Converted at the average exchange rate for the month, this translates to about N201.80bn per day.

A comparison with the budget benchmark of N163.42bn per day shows a positive variance of N38.38bn daily. Over the 31 days in March, this translates to an estimated windfall of N1.19tn.

Despite production falling short of the budget target by about 250,000 barrels per day, the higher oil price ensured that overall revenue remained significantly above projections.

The gains became more pronounced in April, when both production and prices increased. Oil output is expected to rise to a conservative average of 1.7 million barrels per day (based on claims by the NUPRC that oil production had surged to 1.8 mbpd), while the average price surged to $127.05 per barrel. The exchange rate for the month was approximately N1,365 to the dollar.

Based on these parameters, daily oil revenue climbed to about $216.0m, calculated by multiplying 1.7 million barrels by $127.05. When converted to naira, this yields approximately N294.84bn per day.

Compared to the budget benchmark, this represents a daily windfall of N131.42bn.

Over the 30 days in April, the total windfall is estimated at about N3.94tn. The sharp increase reflects the combined effect of improved production and a significant spike in global oil prices during the period.

When aggregated, the windfall from both months amounts to about N5.13tn, with March contributing N1.19tn and April accounting for N3.94tn.

The analysis indicates that the surge in oil prices was the dominant factor driving the increase in revenue, as opposed to production growth.

In March, output remained well below the budget benchmark, yet earnings still exceeded projections due to stronger prices.

Though production reportedly improved in April, the scale of the windfall was largely driven by the exceptional surge in crude prices.

The development points to a temporary boost in government revenues and could provide some fiscal relief in the short term.

However, it also highlights the country’s continued vulnerability to volatility in global oil markets, as revenue performance remains heavily dependent on external price movements rather than stable domestic production levels.

Further analysis shows that without the price surge, revenues in both months would have been significantly lower, even with the same production levels and exchange rates.

If March crude had been sold at the budget benchmark of $64.85 per barrel, daily revenue would have been about $100.52m, derived from multiplying 1.55 million barrels by the benchmark price. Converted at N1,370, this amounts to N137.71bn per day, translating to about N4.27tn for the 31-day period.

A similar trend is observed in April. At a production level of 1.7 million barrels per day and the benchmark price of $64.85, daily revenue would have stood at about $110.25m.

Converted at the average exchange rate of N1,365, this gives N150.50bn per day, amounting to approximately N4.52tn for the month.

While the country makes more revenue from oil sales, the masses are at the receiving end as fuel prices continue to rise alongside the crude rates.

The Nigerian National Petroleum Company Limited recently raised the official selling prices of all 37 Nigerian crude grades for May-loading cargoes, according to a report by Oilprice.com.

Related News
Motorists seek FG’s intervention over economic hardship
Sri Lanka hikes fuel prices as inflation spikes
Dangote refinery's jet fuel price to stabilise market - NMDPRA
The report stated that Nigeria was reaping the benefits of the US-Iran war, as the NNPC increased the price of its flagship grade, Bonny Light, by $6.13 per barrel for May compared to April. Similarly, Forcados was also raised by $7.01 per barrel.

“Nigeria reaps the benefits of the Iran war. Nigeria’s national oil company NNPC has raised the official selling prices of all 37 Nigerian crude grades for May-loading cargoes, hiking its flagship grade Bonny Light by a whopping $6.13 per barrel compared to April, while Forcados is up by $7.01 per barrel,” the report stated.

Petrol responded immediately as the Dangote Petroleum Refinery raised the gantry price to N1,275 per litre, up from N1,200 on Wednesday.

Filling stations did not hesitate to move up their pump prices from an average of N1,250 to about N1,350 or N1,400, depending on the location.



Calls for relief

Speaking with Sunday PUNCH, the National President of the Petroleum Products Retail Outlet Owners Association of Nigeria, Billy Gillis-Harry, said he regretted that the Federal Government was not taking steps to support the masses despite making more gains from the high oil prices.

He said, “The government is not making any statements about the rising petrol prices, so it’s worrisome. At least, the government could come up with some measures. We are making some gains now on the price of crude oil. The government can give some back to reduce the cost of transportation so that food will not be expensive, along with a few other things. That’s what we have advised.”

The PETROAN boss said the price of petrol could go above N1,500 per litre if the Middle East crisis is not de-escalated.

“If you go back to our predictions, I stated it there because Mr Trump is not very clear as to what he wants, in my opinion; if it is to decimate the Iranian nuclear facility or if it is to take over the crude oil as they are taking over Venezuela’s. I don’t think we know what he wants exactly. So we are not sure we are seeing the end of that crisis,” he said.

Energy economists called for targeted cash transfers to cushion the impact of rising fuel prices on vulnerable Nigerians as the government makes more revenue from oil.

A former president of the Nigerian Association for Energy Economics, Professor Adeola Adenikinju, said the current situation presents a “two-edged sword” for Nigeria, with potential revenue gains from higher oil prices on one hand and worsening economic hardship for citizens on the other.

According to him, rising petrol costs have triggered increases in transportation fares and inflation, placing additional pressure on low-income households.

“This is the time that Nigeria should say, ‘Look, we are sending some cash to those poor people who are vulnerable,” he said, stressing the need for direct intervention to support the most affected.

He, however, noted that the absence of a reliable database of vulnerable Nigerians remains a major constraint to implementing effective cash transfer programmes.

“If we have the data of all the poor people, this is the time that Nigeria should send some cash to those who are vulnerable, but we don’t have the data,” he added.

Adenikinju said while recent moves to increase allowances for civil servants may provide limited relief, such measures would exclude a large segment of Nigerians working in the private and informal sectors.

He, therefore, urged both federal and state governments to collaborate in designing broader support mechanisms based on that windfall.

Refiners seek domestic crude pricing

In their reactions to the rising oil prices due to the US-Iran war, local refiners urged the Federal Government to drop the use of international pricing benchmarks for crude supplied to domestic plants, saying the current structure inflates costs and undermines local refining.

The spokesperson for the Crude Oil Refiners Association of Nigeria, Eche Idoko, said in an interview that the association had consistently pushed for a domestic pricing arrangement that reflects Nigeria’s peculiarities.

According to Idoko, crude supplied to local refineries should be priced based on locally designed pricing instead of using Brent as a benchmark.

“If you are using Brent to benchmark our pricing, the factors that are affecting the Brent pricing will still affect the price at which you are landing crude here. What we have always insisted on is that those elements in Brent that do not apply to the trade between the local refinery and the oil producers should be discounted. And like that, you get the actual cost of crude for local refineries,” he said.

An economist, Bismarck Rewane, also advised, “One of the options that can be explored is that the Federal Government of Nigeria agrees to sell crude at a particular price to the Dangote refinery with the assurance that the price of refined products does not increase.”

Meanwhile, the N5.13tn windfall reflects the impact of the US–Iran conflict-driven rally in global crude prices on Nigeria’s oil earnings, pushing revenues well above the 2026 budget benchmark. However, the gains remain largely price-driven and external, rather than a result of sustained production growth.

This indicates that a crash in global oil prices would result in a sharp drop in the country’s oil revenue.

The development shows both the immediate fiscal boost and the continued vulnerability of Nigeria’s revenue base to fluctuations in the international oil market. It also highlights the double-edged impact of rising global oil prices, boosting government earnings while simultaneously increasing fuel prices
.


https://punchng.com/us-iran-war-fg-earns-n5tn-oil-windfall-amid-rising-fuel-hardship/

I will take only the meat and go home and cook soup with it!

Extend the time, after all, my governor, Sim has not picked form yet because his case is different, he has not been anointed

When Wike son will be picking his form certainly he will be the youngest

bravehost4u:
Fubara on my mind right now

For now the owner of Rivers State is Wike, he owns the courts and all political parties in the state.
So this arrangement of the APC does not include Sim.

My own be say make this Tinubu government provide an account so I can start to pay back my over N790, 000.00 loan am owing!

PortlegEcom1:
I Know Almost everyone has a Plug for Supplier Payments in China for both WeChat and Alipay.

But in case you don't have any, I can be your Plug.

You see..

Here in China, Students are not allowed to work. Personal Shopping, Factory inspection and Packing and Shipping are our business.

So, in summary, I can help you pay your Suppliers here in China using Alipay or WeChat, verify your goods, and help you package and Ship Them, whichever City they are in.

My WhatsApp Number is +86 198 6737 0341
You can drop your Own Number, and I can Contact You Myself.

Very good business, so long is a legit biz, God go bless your hustle!

Very good, our loved ones should not die in a war where one time Nigeria President said
" A fight against Boko Haram is a fight against the North ".

Please show carton and receipt.
How can a brand new phone came in carryon locked?

Return the phone

This one don watch too much Nollywood movies depicting cats as witches so he has to kill it!!!

Nigerians and yeye movie watchers!!!

Actually when Nigerians say they want 24hrs light , they Actually wanted the lights in the industries, the remaining one for free

Bolaji Abdulahi, said something similar during GEJ era making GEJ appears weak so they could have a reason for APC to take over, he later supported Buhari and now he is against Tinubu.

What a man!!!

When the President said he backed the governors to decide, remember Rivers State no follow ooʻo!!!

givedemwotowoto:
On the contrary, it should actually be illegal to require membership fees for political party membership because it can disenfranchise poor people from participating in partisan politics

Is the cost of acquiring a nomination and expression of interest forms as it is currently being sold by the major political parties not disenfranchising members already?

Just pack and abandoned where you are living without taking furniture, clothes, boxes, and bags.

Now that he is the owner of the PDP, they should simply give him the Presidential ticket and watch what will happen

We4all:
Good thing he was arrested. I hope he has learnt his lessons. However, he may have killed the cat out of ignorance thinking it's an edible animal over there.

If that is the case, his crime should not be labelled 'animal cruelty'. He should be charged with killing of animal prohibited for food.

Ignorance of the law is no excuse in those areas. Even in Nigeria it's true it's when you get to the Police Station then you will confirm

Oluhgbengaa:
Atiku and obi can't beat buhari in 2019

Just lol 😂

This time they will, the reason is that if you combine both Atiku votes and Obi votes in 2023 far exceed BAT Votes

This is the first time of hearing Nigeria importing crude oil.

The combination that would be very difficult for BAT would be Atiku _ Obi connection

When your intentions to lead a people is dubious, with the aim of looting then the Nigerian pattern shouldn't surprise you. But in a system where leadership is about the people, the format automatically changes to visions, sound manifesto, responsibility and strong leadership qualities.

Deceptive leader!
Most Nigerians that find themselves in the corridors of power have a single aim of looting the nation.
Tinubu is not exception. Give them opportunity and watch how they change the narrative they've been advocating.
So it does appear that the Black man has been cursed 🤬 for eternity.

What did they hope to achieve?
But on close examination, Tinubu said he should not be voted for if he can't provide electricity and estimated electricity billings.
Today, Aso rock has exited from NEPA, NRS also followed suit.
So what are we saying?
What Nigerians complain about is something that can be done. It doesn't require rocket science to achieve it.
Provide health care, good roads and electricity.
This can be done by a reasonable government.

christejames:
This directive is better...


At least, we have some of the best PCM and metro manufacturing companies in the continent.


Emzor is there, Cinnamon Drugs, Juhel, Michelle Laboratory, AC Drug, Chemiron are some great brands here.

Absolutely correct, majority of the paracetamol consumed are manufactured locally.
I don't think I have taken a foreign manufactured paracetamol in a very long time.

Challenges of life are gradually redefining the concept of marriage and the trend will certainly continue.
Ladies need to learn this very quickly

Imagine the government budgeting billions for the trial of the Boko Haram while you can just line them up and open fire and use the money to build technical schools and hospitals for the North.

He would have donated the cadavas to the Benue State University for students of Medicine and surgery to learn with

Very smart thinking, most investors in realtor never reason. Maybe many hide this from prospective investors so as to cash out easily

Simple, I block the Atlantic Ocean of money.
You continue blocking your Strait!

Then we will see how it ends

This war is very interesting, any day Iranian wake up on a bad day, they simply closed the Strait!
The US too has seen a new pattern to closed another part of the sea too.

I think Nigeria can make a lot of money closing the Atlantic ocean.

This is indeed troubling. The level of debts is indeed too much.