Nigeria’s struggling revenue profile is set for a rise as Brent crude yesterday, rose above $100 a barrel for the first time in nearly two months, hitting $100.69 over escalating attacks on commercial shipping in the Red Sea deepen concerns that the Middle East supply crisis is spreading beyond the Strait of Hormuz.
The 2026 federal budget of Nigeria is anchored on an oil price benchmark of $64.85 per barrel and targeted crude oil production of 1.84 million barrels per day.
The latest increase in crude oil price marks a hike of $36.42 per barrel above the projected oil price benchmark of $64.85.
By mid-morning Thursday, front-month Brent for September delivery was trading at $100.69 a barrel, up more than seven per cent on the day after touching an intraday high of $101.01. WTI was also sharply higher, with the entire Brent forward curve moving higher as traders priced in a greater risk of prolonged supply disruptions.
The latest leg higher comes after Houthi claims that the group struck two Saudi oil tankers in the Bab el-Mandeb Strait, after declaring a naval blockade of Saudi exports earlier this week. Several ships are reported to have changed course or delayed their transit through the chokepoint, threatening the export route. Saudi Arabia has depended upon to evade disruptions in the Strait of Hormuz.”
The move is further escalation for a market that had spent weeks betting geopolitical risk would ease. Brent crude has climbed about 20 per cent in around two weeks as repeated attacks on commercial shipping, renewed fighting involving Iran and escalating export disruptions have steadily eroded expectations of a swift return to normal oil flows.
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The rally is no longer just about fears around Hormuz. Kazakhstan has started cutting oil production after drone attacks shut down tanker loadings at the Caspian Pipeline Consortium terminal on the Black Sea. Indian state refiners have suspended loadings of Iraqi crude because of shipping risks through Hormuz. Months of Ukrainian drone strikes on refineries continue to limit Russian fuel exports.
And so are the physical markets. Futures are tightening. Governments worldwide have already released hundreds of millions of barrels from strategic reserves since the Middle East conflict began, commercial stocks have dropped significantly and China has cut imports by tapping stockpiles built before the war. Those buffers are slowly eroding.
Brent’s return to triple digits brings the market back into territory many analysts thought had been avoided after the U.S.-Iran memorandum of understanding briefly reopened hopes that Middle East exports would normalize. But those expectations have unravelled quickly as the conflict has widened from Hormuz to the Red Sea, putting two of the world’s most important oil shipping routes under simultaneous threat.
