Nigerian crude oil ended Tuesday’s trading on a high note, selling at an average of $68 per barrel, outpacing the international benchmark Brent Crude by approximately $4. Brent crude opened mid-week trading at around $64 a barrel, reflecting ongoing instability in the global oil market.
Farouk Ahmed, Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), highlighted the adverse implications of this volatility for Nigeria’s economy. “Although we, as consumers, appreciate the price drop, it is detrimental to our economy as our revenue inflows are also affected,” Ahmed said, noting the country’s dependence on oil exports for national income.
The uncertainty in the market has been further exacerbated by inconsistent policy communication from U.S. President Donald Trump, whose administration’s shifting stance on tariffs has rattled global markets. Analysts suggest that the macroeconomic challenges tied to forthcoming U.S. economic data releases could deflate earlier investor optimism, particularly surrounding trade relief.
The International Energy Agency (IEA) recently revised its global oil demand growth projection downward to 730,000 barrels per day this year, a sharp fall from the 1.103 million barrels per day forecasted last month. This adjustment reflects broader pessimism as global oil prices continue to decline and earlier hopes of tariff rollbacks wane.
Meanwhile, Nigeria is contending with internal challenges that are compounding its revenue losses. Militant activity in the southern Niger Delta region has intensified, with attacks targeting vital oil infrastructure. The Movement for the Emancipation of the Niger Delta, alongside the lesser-known Liberation Army of the Niger Delta, has claimed responsibility for sabotaging a critical oil pipeline connected to a terminal in Bayelsa State.
Oando Energy, one of Nigeria’s major energy companies, has suffered three separate attacks on its pipelines within the past week. These acts of sabotage come in response to President Bola Tinubu’s declaration of a state of emergency in Rivers State, where he suspended Governor Siminalayi Fubara, Deputy Governor Ngozi Odu, and elected state legislators after prolonged political strife.
The international oil outlook remains grim. President Trump’s aggressive trade strategy—marked by sweeping tariffs on Chinese imports and threats of further levies against other nations—has introduced significant volatility to global crude markets. Price movements have reflected the erratic nature of these policies, often reacting negatively to new tariffs but rebounding with announcements of waivers or exemptions.
The NMDPRA head acknowledged these developments, stating: “As everyone is aware, the world economy and oil market have been somewhat unstable recently due to the new American government’s tariff policy, which targets not only China but the world at large.”
Leading financial institutions such as UBS, BNP Paribas, and HSBC have revised their crude price forecasts downward in response to growing fears of a global economic slowdown driven by U.S.-China trade hostilities. In this increasingly fraught economic climate, Trump’s latest tariff hike on Chinese goods has triggered retaliatory measures from Beijing, further straining the already fragile global trade environment.
Amid these challenges, Nigeria continues to diversify its crude oil portfolio. Argus Media reports that the country has added a new medium-sweet crude blend, Obodo, to its export roster, joining established grades such as Forcados, Escravos, and Bonga. Obodo, which debuted in April, is tailored for the European market. Refinery activity in Europe is expected to ramp up once seasonal maintenance concludes by the end of next month, potentially boosting demand for Nigerian exports.