Oil prices rose more than one percent yesterday, supported by Middle East tensions and Organisation of Petroleum Exporting Countries (OPEC)-led supply cuts.
Brent settled at $70.11, rising $1.42, or 2.07 per cent, after having fallen by about 4.5per cent last week. U.S. West Texas Intermediate crude futures were up 59 cents, or one per cent, to $59.24 a barrel.
Consistent rise in oil prices is good for Nigeria, Africa’s largest oil producer that depends on oil proceeds to implement her national budget.
Yesterday, President Muhammadu Buhari signed the 2019 appropriation bill of N8.91 trillion into law.
The budget was based on estimated crude oil production of 2.3 million barrels a day (bpd) and the crude oil price of $60 per barrel.
The budget deficit is put at N1.9 trillion.
Parliament had passed the budget into law after increasing the budget size from its initial N8.83 trillion.
The margianl price rise in oil prices was spurred by continued crude disruptions from Russia after a contamination problem discovered last month.
Output reductions – both voluntary by the OPEC and allies, plus those resulting from U.S. sanctions – have helped Brent crude, the global benchmark, rise by about 29 per cent this year.
Public holidays in the U.S. and Britain yesterday limited participation, keeping volumes low.