crude oil
Global oil prices traded within a tight range on Monday as markets weighed renewed diplomatic engagement between the United States and Iran against ongoing geopolitical tensions and fresh supply signals from the OPEC+ alliance.
International benchmark data showed that Brent crude remained above Nigeria’s 2026 oil price benchmark of $64.85 per barrel, providing modest fiscal support for the country’s revenue outlook.
Brent crude futures rose by 3 cents to $67.78 per barrel in early trading, after settling 23 cents higher in the previous session. Meanwhile, U.S. West Texas Intermediate (WTI) crude gained 2 cents to $62.86 per barrel, though no official settlement was recorded due to a U.S. public holiday.
At its current level, Brent is trading approximately $3 above Nigeria’s budget benchmark, offering limited but positive headroom for petroleum revenue projections embedded in the 2026 fiscal framework.
Market Sentiment and Weekly Performance
Despite the slight uptick in early trading, both major benchmarks recorded mild losses last week amid cautious investor sentiment.
- Brent crude declined about 0.5% last week.
- WTI crude fell roughly 1% over the same period.
Analysts note that while prices have softened slightly, geopolitical risks and managed supply adjustments are helping to prevent sharper declines.
Diplomatic Developments in Focus
Oil markets are closely monitoring diplomatic talks between Washington and Tehran. U.S. President Donald Trump last week suggested that the United States could reach an agreement with Iran within a month, raising expectations of a possible easing of sanctions and a return of additional Iranian crude to the global market.
Negotiations over Iran’s nuclear programme resumed earlier this month, with a second round of talks scheduled to hold in Geneva. An Iranian diplomat, according to international reports, indicated that Tehran is seeking a broader agreement that could unlock economic cooperation in sectors such as energy, mining and civil aviation.
However, tensions remain elevated. The United States has reportedly deployed a second aircraft carrier to the region, while Iran’s Revolutionary Guards have warned of retaliatory action in the event of military confrontation. These mixed signals continue to sustain a geopolitical risk premium in oil prices.
Supply Signals from OPEC+
On the supply side, OPEC+ is considering resuming previously paused output increases from April after a three-month halt. The move is aimed at balancing market stability with expected peak summer demand.
The proposed output adjustment could help prevent excessive price spikes that might weaken consumption. However, any disruption to Middle East supply routes could quickly tighten global markets and drive prices higher.
Implications for Nigeria
Nigeria’s 2026 fiscal framework is built on an oil price benchmark of $64.85 per barrel and a production target of 2.6 million barrels per day.
Recent data indicate that Bonny Light, Nigeria’s flagship crude grade, dipped below $69 per barrel in recent trading sessions, reflecting broader global softness.
With Brent currently trading above the budget benchmark, the country enjoys a modest cushion. However, sustained price stability and improved production levels will be critical to meeting revenue projections in the 2026 budget.
