Crude oil prices surged on Monday, reaching $79 per barrel - the highest level in more than a year - and surpassing Nigeria’s 2026 budget benchmark of $64.85 per barrel.
Brent crude, the international benchmark, rose over 9 percent, briefly touching $82 before settling at $79. US West Texas Intermediate (WTI) also jumped more than 9 percent, trading at $73.06 per barrel.
The spike follows escalating geopolitical tensions in the Middle East. On Saturday, US and Israeli strikes targeted Iranian military sites, killing Supreme Leader Ayatollah Ali Khamenei, armed forces chief Abdolrahim Mousavi, and several family members, including Khamenei’s daughter, grandchild, daughter-in-law, and son-in-law.
In retaliation, Iran launched multiple missile strikes across the region, raising fears of a wider conflict that could disrupt global energy supplies.
Maritime traffic has already been affected, with major shipping companies - including Maersk, Mediterranean Shipping Company (MSC), and CMA CGM - suspending sailings through the Strait of Hormuz and the Suez Canal–Bab el-Mandeb corridor due to security concerns. These waterways account for around 20 percent of the world’s seaborne oil and liquefied natural gas (LNG) trade.
Market experts warn that sustained price increases could stoke global inflation, acting as a hidden tax on consumers and businesses while potentially reducing energy demand.
For Nigeria, the oil price rally offers a potential fiscal windfall. The current benchmark of $79 per barrel exceeds the country’s projected 2026 budget reference of $64.85, potentially easing revenue pressures for the government amid ongoing fiscal challenges.
The price surge highlights the vulnerability of global oil markets to geopolitical events, while providing short-term relief to oil-dependent economies like Nigeria. Analysts say continued monitoring of the Middle East situation will be key to anticipating further market volatility and its impact on global and domestic oil revenues.
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