Nigeria’s revenue and those of crude-dependent economies will experience a drop as oil prices slide again on Wednesday, the third day since the start of the week.
Drop in prices rode on the back of doubts about the effectiveness of Russia sanctions and a potential OPEC+ output increase, putting pressure on the market.
Brent crude futures were down 7 cents, or 0.11%, to $64.33 a barrel at 0511 WAT. U.S. OPEC daily basket price dropped to $67.54 per barrel from $68.33 recorded last week. The West Texas Intermediate crude futures fell 7 cents, or 0.12%, to $60.08.
Nigeria’s 2025 budget had benchmarked $75 per barrel crude oil price.
U.S. crude, gasoline, and distillate stocks fell last week, Reuters quoted market sources, citing American Petroleum Institute figures on Tuesday.
Crude stocks fell by 4.02 million barrels for the week ended October 24, the sources said, requesting anonymity.
Gasoline inventories dropped by 6.35 million barrels, while distillate inventories fell by 4.36 million barrels from a week earlier, the sources said.
The larger-than-expected draws triggered a short-term price surge during the last trading session and supported the market early this morning.
Brent and WTI last week registered their biggest weekly gains since June after U.S. President Donald Trump imposed Ukraine-related sanctions on Russia for the first time in his second term, targeting major oil companies Lukoil and Rosneft.
Still, doubts that sanctions would offset oversupply and talk of an OPEC+ output increase pressured prices; both benchmarks fell 1.9%, or more than $1, in the previous session.
On Tuesday, the Kremlin said Russia offered top-quality energy at a good price, and its partners would decide for themselves whether to buy its energy after the U.S. applied its sanctions.
That was following sanctions over Ukraine imposed last week by the United States.
Many Indian refiners have paused new orders for Russian oil as they await clarity from the government and suppliers, with some turning to the spot market for alternatives, sources in the industry said.
Reuters report said state-run Indian Oil, on Tuesday, said it would not stop buying Russian oil as long as it was complying with sanctions.
In the first half of 2025, Nigeria generated ₦5.21 trillion from the sale of crude oil, gas, and other related activities.
Data obtained from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) revealed that total crude oil and condensate output between January and August stood at 406.84 million barrels, representing an 18.27 per cent deficit against the 500.58 million barrels projected in the budget for the period.
The development followed a Channels Television report at the weekend, that Nigeria is expected to add new gas projects to boost exports following a ban placed by the European Union on the importation of Liquefied Natural Gas from Russia. Nigeria To Export More Gas After EU Ban On Russian LNG
The U.S. government has provided written assurances that Rosneft’s German business would be exempt from the sanctions because the assets are no longer under Russian control, Germany’s economy minister said.
On Tuesday, the CEO of Saudi state oil giant Aramco said crude oil demand was strong even before sanctions were imposed on Russian oil majors, and Chinese demand was still healthy.
OPEC+, the world’s largest group of oil-producing nations, is leaning towards a modest output boost in December, four sources familiar with the talks told Reuters, with two sources citing an additional 137,000 barrels per day.
Nigeria’s crude oil production in September 2025 was 1.39 million barrels per day (bpd), a drop from 1.434 million bpd in August. This decrease was caused by a three-day labor strike by the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), which led to the shutdown of production and export facilities.
The September total production was 1.581 million bpd, consisting of 1.39 million bpd of crude oil and 191,373 bpd of condensates.
The Federal Government has said it would push for an increase in the country’s OPEC+ quota from current 1.5mb/d. The country targets production of 2.06mb/d.
However, Nigeria risks lower revenue if crude prices continue their current downward trend.
Credit: Channels.com
