Oil prices surge above Nigeria’s budget benchmark amid escalating Iran-Israel conflict

Global oil prices jumped sharply on Tuesday, surpassing Nigeria’s 2025 budget benchmark of $75 per barrel, as tensions in the Middle East intensified following renewed hostilities between Iran and Israel.

Brent crude, the global oil benchmark, soared by 5.29% to $77.04 per barrel, while U.S. West Texas Intermediate (WTI) rose by 5.28% to $74.84 per barrel. The spike in prices reflects growing fears of supply disruptions as the conflict threatens key energy infrastructures in the region.

According to a Reuters report, Iran has partially halted gas production at the South Pars field, a major gas reserve it shares with Qatar, after a fire broke out—allegedly triggered by an Israeli airstrike. In another related attack, Israel reportedly hit Iran’s Shahran oil depot, escalating concerns about the safety of the region’s oil supply chain.

On Friday, June 13, oil prices jumped by over 7 percent the highest single-day gain in over four months amid the deepening regional hostilities.

The surge in oil prices signals a potential boost in revenue for Nigeria, whose 2025 budget is predicated on a $75 per barrel oil benchmark.

However, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) disclosed that the country’s crude oil production declined to 1.45 million barrels per day in May — 97 percent of its OPEC quota.

Despite the drop in output, Nigeria retained its position as Africa’s largest oil producer in May, according to the Organisation of the Petroleum Exporting Countries (OPEC), which also reaffirmed its 2025 global demand growth forecast of 1.3 million barrels per day.