Nigeria’s downstream petroleum sector may experience renewed instability as industry experts warn that global crude oil prices could rise to $130 per barrel if tensions involving the United States and Iran escalate further and disrupt global supply.
The ongoing conflict has already pushed crude oil prices above $100 per barrel, up from about $85 per barrel, contributing to a sharp increase in the cost of Premium Motor Spirit (PMS), commonly known as petrol, across parts of Nigeria.
In separate interviews, industry analysts said the conflict may continue for some time and could keep oil prices under upward pressure in the international market.
The Chief Executive Officer of petroleum.ng, Olajide Jeremiah, stated that the conflict shows no sign of ending soon, noting that the countries involved are major players in the global oil industry.
He added that the expansion of hostilities and the destruction of oil and gas installations have affected operations in some areas.
Similarly, the National President of the Oil and Gas Services Providers Association of Nigeria (OGSPAN), Colman Obasi, said there is currently no indication that the conflict will end soon, adding that prolonged hostilities could continue to drive speculation and increase oil prices.
Meanwhile, JPMorgan Chase projected that Brent crude could reach $120 per barrel if a full-scale conflict in the Middle East disrupts oil shipments through the Strait of Hormuz, a major global oil transit route.
Despite earlier increases, petrol prices have recently stabilised in some parts of Nigeria. Checks indicated that petrol sold for about N1,040 per litre in Lagos and N1,080 per litre in Abuja after previously rising to around N1,100 per litre.
The development follows a recent increase in the ex-gantry price of petrol by the Dangote Refinery, which raised the price to N995 per litre.
At retail outlets of the Nigerian National Petroleum Company Limited (NNPC), petrol was sold at about N1,040 per litre, representing an increase of N47 from the previous price of N993 per litre.
Other filling stations, including Emadeb Energy and PM Petroleum, also sold the product at about N1,040 per litre, while Gegu Oil Nigeria sold petrol at N1,050 per litre in Abuja and Empire Energy sold it at N1,080 per litre.
The changes in pump prices reflect the impact of developments in the global oil market on domestic fuel costs in Nigeria.
