Oil prices surpassed $70 per barrel on Monday for the first time in more than three months as the United States warned of increased threats to energy facilities in the Middle East after the assassination of an Iranian General, Qassem Soleimani, last week. The international oil benchmark, Brent crude, jumped 1.5 per cent to as high as $70.74 per barrel, its highest price since September, before easing to $69.17 per barrel as of 5.10pm Nigerian time.
The 20G0 budget, which was signed by the President, Major General Muhammadu Buhari (retd.) in December, was based on oil production of 2.18 million bpd with an oil price benchmark of $57 per barrel. Brent, against which Nigeria’s oil is priced, has climbed more than five per cent since a US air strike killed Soleimani in Iran on Friday.
The latest gains followed a weekend of threats between Washington and Tehran, bringing the pair closer to conflict and raising tensions throughout the Middle East, according to Financial Times. Crude oil previously traded above $70 per barrel in September 2019 after drone strikes, which the US blamed on Iran, temporarily knocked out half of Saudi Arabia’s oil production.
Soleimani was the head of the Iranian Revolutionary Guard’s overseas forces and controlled the regime’s extensive influence across Lebanon, Iraq, Syria and Yemen. The US State Department warned on Sunday that there was an increased risk of attacks on oil facilities and other targets in Saudi Arabia, amid widespread expectations Iran would retaliate for the killing of Soleimani. Following the assassination, Iran said it would no longer abide by any of its commitments to the 2015 nuclear accord it signed with world powers.