Israel-iran Conflict: Oil Prices Drop To 70 Per Barrel

The price of Nigerias Bonny light dropped to 70 per barrel, yesterday, down from 77 per barrel recorded in June 2025, following the ceasefire in the Israel-Iran conflict. This development poses a significant challenge to the nation, as the 2025 budget was benchmarked at 2.06 million barrels per day and 75 per barrel. Dr. Diran Fawibe, Chairman of International Energy Services Limited, attributed the price drop to short-lived fears about possible disruption or restriction in the flow of oil in the international market. In an interview with Energy Vanguard, he explained that speculation about meeting demand requirements led to the initial price increase, but the fears were short-lived, causing prices to drop. Prof. Wumi Iledare, a Professor of Petroleum Economics, noted that the geopolitical situation might inject a short-term risk premium into global oil prices. However, he added that sustained price escalation remains uncertain unless there is a tangible disruption to physical supply, particularly through the Strait of Hormuz. Regarding the impact on Nigeria, Prof. Iledare said that while higher crude prices could momentarily boost export revenues, they also risk fueling domestic inflation and encouraging fiscal complacency. He emphasized the need for structural reforms to mitigate potential macroeconomic vulnerabilities. In a related development, the International Monetary Fund IMF has called on Nigeria to raise more domestic revenue, improve its budgeting process, and expand cash transfers to lift millions out of poverty. In an article published on Monday, the IMF stated that Nigeria needs stronger and more sustained growth to lift millions of people out of poverty and food insecurity. The IMF also emphasized the importance of an effective budget framework, highlighting the need for realistic budget assumptions, strong expenditure management, and transparent implementation and reporting to strengthen accountability. IMF, stated: As an essential ingredient for economic development, Nigeria needs an effective budget framework. Delivering effective investments in people and infrastructure requires realistic budget assumptions, strong expenditure management, and transparent implementation and reportingwhich, in turn, can strengthen accountability.