Growing tensions in the Middle East, sparked by ongoing military actions involving the United States and Israel against Iran, are driving up fuel prices in Nigeria.
Crude oil prices climbed to $72.87 per barrel on Sunday, with analysts predicting further increases if the conflict escalates.
The situation is particularly concerning for Nigeria, as it relies heavily on imported refined petroleum products, making it vulnerable to international price fluctuations.
The conflict has disrupted global shipping routes, with several major shipping companies avoiding the Strait of Hormuz due to safety concerns.
This has pushed up transportation costs and insurance premiums, contributing to higher fuel prices.
Nigeria’s reliance on imported fuel means that consumers are likely to feel the pinch, with potential price hikes for petrol and diesel.
The Nigerian government may see increased revenue from oil exports, but experts warn that the benefits could be offset by production shortfalls and limited refining capacity.
Energy expert Kelvin Emmanuel explained that as crude prices rise, government revenue will increase since the 2026 budget benchmark stands at $64.85 per barrel.
However, in the post-subsidy era, higher crude costs would force refineries—including Dangote Refinery—to adjust petrol prices based on operational realities.
Economic analyst Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), stated that geopolitical conflicts in the Middle East often trigger oil price spikes due to fears of supply disruptions.
He said Nigeria could benefit from increased export earnings, improved foreign exchange inflows, stronger external reserves, and higher FAAC allocations.
