Oil Marketers
Iyunade Grace
The escalating conflict between the US and Iran is sending shockwaves through Nigeria’s fuel market, with petrol prices hitting new heights. The price surge is largely driven by the global oil price hike, with Brent crude rising to $73 per barrel, its highest level in six months.
As a result, the Dangote Petroleum Refinery has increased its petrol price to N874 per liter, which may lead to retail prices soaring to N980-N1,000 per liter. This development is expected to worsen Nigeria’s inflation and deepen economic hardship for citizens .
The conflict has also raised concerns about potential disruptions to oil shipments through the Strait of Hormuz, a critical waterway handling 20% of global oil flows. If the situation escalates, oil prices could climb even higher, potentially reaching $100 per barrel .
Experts warn that the relief from lower petrol prices may be short-lived if crude oil prices approach the $90 per barrel mark due to the conflict. The Centre for Promotion of Private Enterprises (CPPE) has raised alarm over the potential economic fallout, warning that the conflict could significantly drive up the cost of petroleum products in Nigeria and worsen inflationary pressures .
The CPPE noted that the war could lead to a spike in prices of diesel, jet fuel, gas, and other energy products, with ripple effects across Nigeria’s economy. Elevated energy costs, inflation, and interest rates could dampen business profitability, particularly in the non-oil sector .
Nigerian firms with supply chain ties or business interests in the Middle East are especially vulnerable. The conflict could disrupt key shipping routes, increasing the cost of imported goods and exacerbating inflation.
The Nigerian government has called on the warring parties to end hostilities and resume dialogue. Meanwhile, experts suggest that the country should focus on boosting crude production and curbing oil theft to mitigate the impact of the conflict.
The situation is being closely monitored, and the impact on Nigeria’s economy will largely depend on the duration of the conflict and the government’s response.
