Crude Oil at $100: Experts Warn Nigerians to Prepare for Higher Petrol, Transport, Food Prices
- Crude oil prices have risen above $100 per barrel, raising concerns that petrol prices and inflation could increase in Nigeria
- The FG could earn billions of naira in extra oil revenue because prices are far above the 2026 budget benchmark of $64.85 per barrel
- Industry experts warn that the surge in global oil prices is likely to trigger fresh fuel price volatility and increase the cost of living
Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology, banking and the economy.
Nigeria could be on the verge of another wave of inflation after global crude oil prices climbed above $100 per barrel following the worsening conflict between the United States and Iran, raising concerns over higher petrol prices, transport costs and the overall cost of living.
The sharp rise in oil prices is also expected to boost government earnings, as Nigeria could generate billions of naira in additional revenue from crude exports if current prices and production levels are sustained.
Source: UGC
Rising oil prices bring revenue boost for government
Nigeria's Bonny Light crude crossed the $100 per barrel mark for the first time since May, driven by fears that escalating tensions in the Middle East could disrupt global crude supply, according to Vanguard.
The region supplies nearly one-third of the world's oil exports, making any prolonged conflict a major threat to energy markets.
The development comes as the Federal Government's 2026 budget was based on an oil benchmark of $64.85 per barrel, daily crude production of 1.84 million barrels, and an exchange rate of N1,400/$1.
With Bonny Light now trading about $35 above the budget benchmark, the government stands to record significant unplanned oil revenue, provided production levels remain stable and exports are not disrupted.
Consumers may face higher petrol, transport costs
Despite the expected revenue windfall, analysts warn that ordinary Nigerians could bear the negative consequences of rising crude prices under the country's deregulated downstream petroleum market.
Higher international oil prices increase the cost of importing refined petroleum products, leading to higher landing costs and putting pressure on marketers to raise pump prices.
Industry data from Petroleumprice.ng showed that before the latest price spike, several fuel depots in Lagos, Warri and Calabar had lowered their loading prices to attract customers, while prices in Port Harcourt remained largely unchanged. Petrol currently sells for between N1,300 and N1,400 per litre at many filling stations across Lagos and surrounding areas.
Any increase in pump prices is expected to push up transportation costs, with ripple effects on food prices, manufactured goods and other essential commodities, potentially worsening inflation across the country.
Industry experts warn of fresh market volatility
The Managing Director of Petroleumprice.ng, Jeremiah Olatide, said recent efforts to reduce fuel prices may be short-lived because of the sudden surge in crude oil prices.
He explained that after Dangote Petroleum Refinery resumed loading petrol in naira at N1,215 per litre on Wednesday, many expected importers to lower prices, and some marketers had already begun making adjustments.
He said:
"However, the sudden spike in crude oil prices due to the Middle East crisis has disrupted that trend. We should expect more price instability in the coming weeks."
Source: UGC
Also commenting, the National President of the Oil and Gas Services Providers Association of Nigeria (OGSPAN), Mazi Colman Obasi, said although widespread price increases have not yet been implemented by depots and filling stations, the effects are likely to spread throughout the economy once operators across the petroleum value chain adjust their prices.
He warned:
“The implications will be far-reaching for households, businesses and the wider economy once operators across the value chain adjust their prices."
Source: Legit.ng
