Bonny Light, Nigeria’s key crude, dropped below $69 a barrel amid rising global tensions.
Meanwhile, traders reacted cautiously to US-Iran tensions, warning ships to avoid Iranian waters and refuse boarding.
Bonny Light Price Drops
Because Bonny Light is premium, buyers often pay more than for heavier, sourer oil grades.
Consequently, Brent crude fell slightly to $68.85, and US West Texas Intermediate dropped to $64.15.
Strait Of Hormuz Risks
Furthermore, the Strait of Hormuz carries around 5% of global oil, creating a vital chokepoint.
Since Iran and other OPEC members export much crude through the strait, supply remains sensitive.
Thus, any escalation in the region could disrupt supplies and sharply impact global oil prices.
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Additionally, Nigeria and Libya reduced output, which contributed to OPEC’s overall decline by 60,000 barrels daily.
In fact, a Reuters survey showed Nigeria suffered the largest output drop among OPEC members.
Meanwhile, President Tinubu aims for 3 million barrels per day by 2030, targeting 2.5 million by 2027.
Moreover, the government approved 28 new oil projects, totalling $18.2 billion, to boost production capacity.
For example, Shell plans Bonga South West, which may add 150,000 barrels daily, involving $20 billion investment.
However, rising costs, about 40% higher than comparable regions, threaten Nigeria’s crude competitiveness internationally.
Consequently, exports fell roughly 14%, even as prices hovered near $70 amid supply concerns.
Geopolitical Tensions
Meanwhile, the EU imposed stricter sanctions on Russian oil, targeting ports and refineries to reduce exports.
These measures could tighten supply, affect Asian trade routes, and potentially push global prices higher.
Currently, oil markets remain tense, with WTI crude trading between $61 and $66, signalling consolidation.
Finally, traders expect a breakout: above $66 could trigger $70, while below $61 may push prices lower.
Overall, Bonny Light sits at the centre of global uncertainty, balancing supply, demand, and geopolitical tensions.
