Lagos, Nigeria – Global oil prices traded within a narrow band on Monday as markets balanced renewed diplomatic engagement between the United States and Iran with persistent geopolitical tensions and fresh supply signals from the OPEC+ alliance.
Okay News reports that Brent crude futures rose by three cents to $67.78 per barrel in early trading, after settling 23 cents higher in the previous session. US West Texas Intermediate crude also rose by two cents to $62.86 per barrel. These price movements mean Brent currently sits about $3 above Nigeria’s 2026 budget benchmark of $64.85 per barrel, offering modest fiscal support for the country’s revenue projections.
The price levels carry significant implications for Nigeria’s finances. The 2026 fiscal framework, approved by the Federal Executive Council, is built on an oil benchmark of $64.85 per barrel and a production target of 2.6 million barrels per day. Therefore, every dollar above this benchmark provides additional revenue cushion for government spending plans. However, Bonny Light, Nigeria’s flagship crude grade, dipped below $69 per barrel during last week’s trading sessions, mirroring broader market softness.
Oil markets have been closely watching diplomatic developments between Washington and Tehran. Comments by US President Donald Trump last week indicated that the United States could reach a deal with Iran within a month. These remarks added downward pressure on prices as traders factored in the possibility of eased sanctions and increased Iranian crude supply. Negotiations between both countries resumed earlier this month to address disputes over Iran’s nuclear programme, with a second round of talks scheduled to take place in Geneva.
An Iranian diplomat, according to Reuters, indicated that Tehran is seeking a nuclear agreement that could unlock economic cooperation in energy, mining, and civil aviation. However, mixed signals persist. The United States has reportedly dispatched a second aircraft carrier to the region, while Iran’s Revolutionary Guards have warned of retaliatory action if attacked. Consequently, a fragile security backdrop continues to keep a geopolitical risk premium embedded in oil prices.
Beyond diplomatic considerations, supply-side developments are also shaping price expectations. The OPEC+ alliance is leaning toward resuming previously paused output increases from April after a three-month halt. This move aims to balance market stability with anticipated peak summer demand. The proposed output adjustment is designed to prevent excessive price spikes that could weaken consumption. However, any disruption to Middle East supply routes could quickly tighten global markets. The interplay between controlled supply increases and geopolitical uncertainty is likely to keep prices trading sideways in the near term.
Weekly performance across major benchmarks points to mild losses amid cautious investor sentiment. Brent crude fell about 0.5 percent last week, while WTI declined roughly one percent over the same period. Despite these softening trends, geopolitical risks and supply management efforts are helping to prevent sharper declines.
What happens next depends on the outcome of US-Iran negotiations and OPEC+ decisions on production levels. Nigeria’s fiscal position will remain sensitive to these global forces, with every movement in crude prices affecting government revenues and foreign exchange earnings.
