KEY POINTS
- Global oil prices surged to four-month highs as fears of a possible US strike on Iran added a geopolitical risk premium.
- Nigeria’s Bonny Light traded near $69 per barrel, while Brent rose to $69.34 and WTI to $64.
- Nigeria remains below its OPEC quota and is relying on new licensing rounds and future projects to lift production over the medium to long term.
Crude oil prices climbed sharply on Thursday, extending gains for a third consecutive session, as growing fears of a potential US military strike on Iran heightened concerns about supply disruptions in the Middle East.
Nigeria’s Bonny Light crude, the country’s flagship grade, traded close to $69 per barrel, reflecting the broader upswing in global oil markets.
US West Texas Intermediate (WTI) crude rose by 92 cents, or 1.5 per cent, to $64 per barrel, while Brent crude futures gained 94 cents to $69.34 per barrel. Both benchmarks are at their highest levels since September 29 and have advanced about 5 per cent since Monday.
Trump’s Threats Add Risk Premium to Oil Markets
The rally has been largely driven by escalating tensions between Washington and Tehran. President Donald Trump has increased pressure on Iran to halt its nuclear programme, warning of possible military action if Tehran fails to reach a deal.
Trump said on Wednesday that “time is running out” for Iran to agree to a nuclear pact, adding that a large US naval force is heading toward the region and is prepared to act “swiftly and violently” if necessary.
A US official confirmed that about ten American warships are currently deployed in the Middle East, a show of force that has unsettled energy markets.
Iran is among the world’s top ten oil producers and the fourth-largest producer within the Organisation of Petroleum Exporting Countries (OPEC), pumping about 3.2 million barrels per day.
The country also borders the Strait of Hormuz, a critical chokepoint through which roughly 20 per cent of global crude oil supplies pass. Any disruption in or around the waterway could have major consequences for global energy flows.
As a result, traders are adding a geopolitical risk premium to oil prices, particularly after the White House reiterated earlier this week that it could halt assistance to Iraq, another major oil exporter.
