Oil prices surged in the international market, with Brent crude climbing by 0.56 percent to reach $87.54 per barrel, while US West Texas Intermediate (WTI) crude experienced a 0.79 percent increase, reaching $83.83 per barrel, as of 20.00 WAT. This uptick places both crude benchmarks on course for their highest closures since October 27, 2023, surpassing the federal government’s budgeted oil price of $77.96 per barrel for 2024.
The current prices also outstrip the $65 per barrel utilized by the Nigerian National Petroleum Company (NNPC) Limited in its calculation of the allocated 90,000 barrels of crude under the $3.3 billion crude-for-cash loan agreement with the African Export-Import Bank (Afreximbank). NNPC had previously stated on January 21 that fluctuations in oil prices could impact the pace of repayment for the loan, emphasizing the significance of the allocated crude quantity in ensuring sufficient funds for timely repayment and meeting other financial commitments amidst unpredictable oil price movements globally.
Highlighting the volatility of oil prices, NNPC underscored the necessity for proactive financial planning to navigate fluctuating market conditions effectively. Meanwhile, data from the Organisation of Petroleum Exporting Countries (OPEC) revealed a decline in Nigeria’s average daily crude oil production to 1.32 million barrels per day (bpd) in February, although OPEC’s secondary sources reported a slight uptick to 1.476 million bpd, reflecting a 3.29 percent increase from January’s figures.