KEY POINTS
- Brent crude traded at $67.78 per barrel, $3 above Nigeria’s 2026 benchmark of $64.85, providing modest fiscal support.
- Diplomatic talks between the U.S. and Iran, alongside OPEC+ supply decisions, continue to influence global oil prices.
- Nigeria’s oil revenue projections benefit from steady prices, though market caution persists due to geopolitical risks.
Brent oil prices held steady on Monday as traders weighed renewed diplomatic engagement between the United States and Iran against ongoing geopolitical tensions and fresh supply signals from the OPEC+ alliance.
International benchmarks showed Brent crude futures rose by 3 cents to $67.78 per barrel in early trading, maintaining a margin of approximately $3 above Nigeria’s 2026 oil benchmark of $64.85 per barrel. U.S. West Texas Intermediate (WTI) crude edged up 2 cents to $62.86 per barrel, though no WTI settlement occurred due to a U.S. holiday. The price support provides a modest cushion for Nigeria’s revenue assumptions embedded in the 2026 fiscal framework, which targets production of 2.6 million barrels per day.
Oil markets have closely monitored developments in Washington-Tehran relations. Last week, U.S. President Donald Trump signaled a potential deal with Iran within a month, putting downward pressure on crude prices as traders factored in the prospect of increased Iranian supply.
Diplomatic talks, resumed earlier this month, are focused on resolving disputes over Iran’s nuclear program. A second round of negotiations is scheduled in Geneva. At the same time, U.S. military presence has increased with a second aircraft carrier deployed to the region, while Iran’s Revolutionary Guards warned of retaliatory measures if provoked. These mixed signals have embedded a geopolitical risk premium into oil prices.
Supply Factors and OPEC+ Policy
Supply-side developments also influence market expectations. The OPEC+ alliance is considering resuming previously paused output increases from April after a three-month halt. This adjustment aims to balance market stability with anticipated peak summer demand, preventing excessive price spikes while ensuring supply adequacy.
Any disruption to Middle East supply routes, however, could tighten global markets rapidly. Analysts expect these dynamics to keep prices trading within a narrow band in the near term.
Nigeria’s 2026 fiscal framework relies on a benchmark price of $64.85 per barrel. Brent’s current level above this benchmark offers some fiscal relief, while domestic crude grades like Bonny Light briefly dipped below $69 per barrel last week, reflecting global market softness.
The interplay between geopolitical tensions and controlled OPEC+ supply will likely keep crude prices relatively stable, supporting the country’s budget projections for petroleum revenue.
