Oil price rises to $79 per barrel, overshoots Nigeria’s budget benchmark

Crude oil price surged on Monday to $79 a barrel — thehighest in more than a year, outpacing Nigeria’s budget benchmark. Brent crude, the global oil benchmark, rose over 9 percentto $79 a barrel for the first time since August 2024 — but signals a marginaldrop from an early trading high of $82. The US West Texas Intermediate also rose over 9 percent to$73.06 a barrel. The development came amid worsening geopolitical tensions inthe Middle East. On Saturday, US-Israeli strikes on Iranian targets killedAyatollah Ali Khamenei and Abdolrahim Mousavi, Iran’s supreme leader, and armedforces chief of staff, respectively. Khamenei’s daughter, grandchild, daughter-in-law andson-in-law were also killed in the military operation. In response, Iran launched waves of missiles across theregion, threatening to pull its neighbours into the escalating conflict. Maersk, Mediterranean Shipping Company (MSC), and CMA CGMhave halted sailings through the Strait of Hormuz and the Suez Canal-Babel-Mandeb corridor amid escalating security threats in the Middle East. According to Reuters, about a fifth of the world’s seaborneoil trade and 20 percent of its liquefied natural gas (LNG) pass through theStrait of Hormuz. The publication said a prolonged surge in oil prices couldreignite global inflationary pressures and effectively act as a tax onbusinesses and consumers, potentially weakening demand. Meanwhile, the current oil price has overshot Nigeria’sbudget benchmark, trading above the proposed 2026 reference price of $64.85 perbarrel.

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