Prices of fuel remain very high in Nigeria even though global oil prices dropped to $72 per barrel on Thursday.
The global oil prices dropped to $72 per barrel from about $120 per barrel reached during the U.S-Iran war that began in February.
This means the latest oil price is the lowest since the U.S-Iran conflict began.
Brent crude futures for August delivery fell $1.06, or 1.44%, to $72.68 a barrel by 0639 GMT, while U.S. West Texas Intermediate lost 76 cents, or 1.08%, to $69.58 a barrel.
According to Oilprice.com, crude oil had fallen from $76.75 per barrel on Tuesday to $73.50 on Wednesday, after surging during the conflict as tensions threatened shipping through the Strait of Hormuz.
Rising Middle Eastern supply, together with Iran set to boost sales after a reprieve from U.S. sanctions, drove down prices of physical crude oil cargoes around the world.
Traders grew optimistic that the U.S-Iran agreement would help keep the strategic waterway open, alongside reports of a slight increase in shipping traffic.
An initial accord last week to end the U.S.-Israeli war with Iran, which began on February 28, has allowed the resumption of traffic through the strait.
The accord set up 60 days of negotiations to tackle tougher issues, such as Iran’s nuclear programme. Wright said oil would continue to flow through the strait even if the deal did not hold, and that Iran would not be able to close it again.
Oman opened temporary routes on Wednesday to ease tanker departures from the strait, with the International Maritime Organization and Omani authorities coordinating movements.
According to CNN, traders are still monitoring whether traffic continues to flow smoothly through the strait and whether tensions remain contained across the Middle East.
On Tuesday, President of the United States, Donald Trump, said a record 19 million barrels of oil flowed out of the Strait of Hormuz on Monday. According to Trump, oil prices are tumbling as a result of the oil flow through Hormuz.
“19 million barrels of oil flowed out of the Hormuz Strait yesterday, a record. Oil prices are tumbling down, and the world is a much safer place,” Trump said in a post on his social media handles.
Meanwhile, despite this development, fuel prices remain high in Nigeria.
Pan-Atlantic Kompass reports that after a peace deal was reached on June 14, many Nigerians expected petrol prices to fall below N1,000 per litre.
Recently, the Dangote refinery reduced its petrol gantry price by N75 per litre, from N1,250 to N1,175, prompting importers to also adjust their prices downward.
However, despite the reduction in fuel prices in Nigeria is still above the fee recorded before the U.S-Iran war.
Recall that the Dangote refinery increased its gantry price from N774 to N874 per litre when the Middle East crisis started.
This came as crude oil prices rose to $84 per barrel from below $70 in the days leading up to the airstrikes involving the United States, Iran, Israel, and other countries.
Filling stations also raised petrol prices from about N830 to over N1,300 per litre during the crisis.
