The Price Of Nigerian Crude Oil Rises To $92 Per Barrel, Above The Budget Target

NIGERIAN crude oil has continued to command premium prices, surpassing the federal government's budget benchmark due to investor interest despite supply worries.

The Nigerian crude kinds Brass River and Qua Iboe were trading close to $92 per barrel, which was more than Brent Crude ($89 per barrel) and Bonny Light ($91.37 per barrel).

According to a report, Nigeria has made $13.71 more at the current price of $91.67 a barrel than it did at the benchmark budget of $77.96, with a projected production of 1.78 million barrels per day.

While it is true that measures to stop oil theft have stepped up, Nigeria, the biggest economy in Africa, needs to reach its daily production targets in order to satisfy its financial obligations.

Additionally, worries about the availability of feedstock for future refineries have grown, especially in light of a drone attack by Ukraine on a Russian plant that may have affected fuel output.

Russia, a significant oil producer, is experiencing interruptions in its processing capabilities.

Potential supply disruptions in the Middle East due to tensions between Israel and Iran are also cause for concern. The third-largest producer in OPEC is Iran.

Presently, in order to process domestic oil and further restrict the world's supply, Mexico's Pemex intends to stop exporting up to 436,000 barrels of crude per day.

Crude inventories have also decreased in the United States, the country that consumes the most oil, indicating strong demand.

Nigerian oil faces competition from US suppliers who have increased their market share, even though it sells for a premium.

However while OPEC and Russia have decreased their output, US oil production is increasing.

Refiners in India, a significant buyer of Nigerian crude, are turning to US crude instead of Russian tankers as a result of the sanctions. This is a reflection of a shift in the global oil market.