Oil hits $100: What it means for petrol, transport and food prices in Nigeria
By Aboki Forex —
Global crude oil prices have surged above $100 per barrel for the first time since May, driven by escalating conflict between the United States and Iran. The spike is expected to push petrol prices higher in Nigeria and worsen the cost of living, even as the government faces billions of naira in unexpected revenue.
Nigeria's Bonny Light crude crossed the $100 mark because of fears that tensions in the Middle East, a region supplying nearly one-third of the world's oil exports, could disrupt global supply. The development comes as the Federal Government's 2026 budget was based on an oil benchmark of $64.85 per barrel, daily crude production of 1.84 million barrels, and an exchange rate of N1,400 to the dollar. With Bonny Light now trading about $35 above the budget benchmark, the government could record significant unplanned oil revenue if production levels remain stable and exports are not disrupted.
Petrol prices under pressure despite recent drops
Industry experts warn that the surge will trigger fresh fuel price volatility. Before the latest spike, some fuel depots in Lagos, Warri and Calabar had lowered their loading prices to attract customers, while prices in Port Harcourt remained unchanged. Petrol currently sells for between N1,300 and N1,400 per litre at many filling stations across Lagos and surrounding areas.
The Managing Director of Petroleumprice.ng, Jeremiah Olatide, said recent efforts to reduce fuel prices may be short-lived because of the sudden surge in crude oil prices. He explained that after Dangote Petroleum Refinery resumed loading petrol in naira at N1,215 per litre on Wednesday, many expected importers to lower prices, and some marketers had already begun making adjustments. He said: “However, the sudden spike in crude oil prices due to the Middle East crisis has disrupted that trend. We should expect more price instability in the coming weeks.”
Transport, food and the wider economy
Under Nigeria's deregulated downstream petroleum market, higher international oil prices increase the cost of importing refined products, leading to higher landing costs and pressure on marketers to raise pump prices. Any increase in pump prices is expected to push up transportation costs, with ripple effects on food prices, manufactured goods and other essential commodities, potentially worsening inflation across the country.
The National President of the Oil and Gas Services Providers Association of Nigeria (OGSPAN), Mazi Colman Obasi, said although widespread price increases have not yet been implemented by depots and filling stations, the effects are likely to spread throughout the economy once operators across the petroleum value chain adjust their prices. He warned: “The implications will be far-reaching for households, businesses and the wider economy once operators across the value chain adjust their prices.”
What this means for the naira and Nigerian consumers
For ordinary Nigerians, the crude oil rally is a double-edged sword. While the government earns more dollars from exports, which could support the naira if the extra revenue is used to boost foreign reserves, consumers face higher petrol costs that will drive up transport and food prices. With inflation already high, any additional pressure on household budgets could deepen the cost-of-living crisis. The next few weeks will show how quickly depots and filling stations pass on the crude price increase to pump prices.