Oil Price Hits $79 Per Barrel, Surpasses Nigeria’s 2026 Budget Benchmark

Oil Price Hits $79 Per Barrel, Surpasses Nigeria’s 2026 Budget Benchmark

Crude oil prices surged on Monday, reaching $79 per barrel, the highest level in over a year significantly above Nigeria’s 2026 budget benchmark of $64.85 per barrel.

Brent crude, the global oil benchmark, climbed more than 9 percent to $79 a barrel, after briefly touching $82 earlier in the day. The US West Texas Intermediate (WTI) also rose over 9 percent, trading at $73.06 per barrel.

Analysts linked the sharp price increase to heightened geopolitical tensions in the Middle East.

On Saturday, coordinated US-Israeli military strikes targeted Iran, killing Supreme Leader Ayatollah Ali Khamenei and the country’s Armed Forces chief of staff, Abdolrahim Mousavi. Several members of Khamenei’s family, including his daughter, son-in-law, daughter-in-law, and grandchild, were also reported dead.

In retaliation, Iran launched waves of missile attacks across the region, raising fears of wider conflict. Shipping companies including Maersk, Mediterranean Shipping Company (MSC), and CMA CGM suspended sailings through the Strait of Hormuz and the Suez Canal–Bab el-Mandeb corridor amid security concerns.

The Strait of Hormuz is a critical route, handling about a fifth of the world’s seaborne oil trade and 20 percent of global liquefied natural gas (LNG) shipments. The disruption of supply from this corridor has been cited as a key driver of the oil price rally.

Economists warn that prolonged high oil prices could reignite global inflation, increasing costs for businesses and consumers, and potentially weakening overall demand.

For Nigeria, the surge offers mixed implications. While the current price exceeds the country’s budget benchmark and could boost federal revenues, it also reflects global volatility tied to conflict in the Middle East, underscoring the risks in relying heavily on oil exports.

This marks a critical juncture for Nigeria’s fiscal planning, with policymakers closely monitoring oil market developments amid geopolitical uncertainty.