By Atoyebi Nike
Nigerian oil held firm near $73 following three sessions of decline, even with global supply issues brewing over Russian crude. US President Donald Trump’s threats to punish India for its deals with Moscow stirred concerns, further gripping the oil sector.
Brent dropped below $69, while West Texas Intermediate hovered close to $66 per barrel. Trump’s warning included intent to hike import fees on goods from India, citing its Russian oil ties. This came just before his set deadline for Russia to cease fire in the Ukraine conflict.
News reports noted that Steve Witkoff, US envoy, would visit Moscow this week. Since 2022, India’s oil link with Russia surged, from minimal levels to over one-third of its crude imports. China, too, buys Russian crude in huge volumes.
India’s consistent need for oil keeps Nigeria’s crude moving. It reflects how shifts in world supply zones boost new buyers.
The slim margin between Brent pricing and Nigeria’s crude reflects stiff sector rivalry. Nigeria’s upstream regulator disclosed crude output hit 1.8 million barrels per session. The country sees oil as key to its economy, with it yielding over 80% of forex revenue.
Gbenga Komolfe of the top oil office noted improved security helped boost production, hoping to move from 1 million to 3 million barrels each session. By year-end, Bayo Ojulari of NNPC expects output to top 1.9 million.
June saw full function restored to top Nigerian crude lines, the first in years, reflecting stronger pipeline security.
OPEC+ groups, including big producers like Russia, UAE, Kuwait, Iraq, Oman, Saudi, confirmed fresh hikes in output next month. They stressed this move, the fourth in recent months, is tied to recovery trends in world oil need.
From September, the group will boost yield by 547,000 barrels, moving from earlier cuts introduced in 2023. Yet, experts warn this could dent pricing, with Nigeria’s proceeds from crude possibly dipping.
Patterson from ING noted the risk of ripple fees extending to more buyers beyond India. If India’s link with Russia breaks, it could turn to the Middle East for supply, where OPEC+ is set to fill the gap, per Rystad Energy insights.
