…$100/barrel likely if disruption persists — Analysts
….World’s largest shipping company suspends operations
The joint United States-Israeli operation that killed Ayatollah Ali Khamenei, Iran’s supreme leader, has thrust the Middle East into a widening conflict with profound implications for Africa’s biggest oil-producing country, one where the promise of a fiscal windfall and the threat of rising energy prices are arriving simultaneously.
The strikes, which Donald Trump, the president of US, described as targeting Iran’s nuclear and military infrastructure, upended oil market assumptions over the weekend.
Brent crude, the benchmark against which Nigeria’s Bonny Light is priced, climbed toward $73 per barrel by Sunday afternoon Nigerian time, its highest level in six months, rising more than two percent in a single session as traders react to potential supply disruption risk gathering around the Strait of Hormuz, the narrow chokepoint through which roughly a fifth of the world’s daily oil flows.
Read also: US admits first casualties in war with Iran with three servicemen killed
By Sunday evening, analysts at JPMorgan, Goldman Sachs, and Barclays were debating whether $100 oil, a threshold last breached in 2022, was a question of if or when. Helima Croft of RBC Capital Markets warned on X that Middle East leaders had told Washington a war on Iran could send prices past $100.
Jorge Leon, head of geopolitical analysis at Rystad Energy, predicted a jump of $10 to $20 per barrel when markets reopened Monday if de-escalation remained absent.
“We expect prices to open much closer to $100 a barrel, and perhaps exceed that level if we see a prolonged outage of the Strait,” Ajay Parmar, director of energy & Refining, ICIS.
The double-edged arithmetic
For Nigeria, Africa’s largest oil producer, with a 2026 budget anchored on a conservative benchmark of $64.85 per barrel and a daily production target of 1.84 million barrels, the arithmetic initially looks seductive.
Crude already trading above benchmark levels before the strikes means the federation account receives more per barrel exported.
A sustained surge past $80 or $90 could replenish foreign reserves, strengthen the naira, and generate fiscal headroom that President Bola Tinubu’s reform agenda urgently needs.
“An increase in international crude oil prices is positive for government earnings and budgeting. However, the impact on consumers would be significant, especially in a deregulated market,” Olufemi Idowu, a partner at Kreston Pedabo said.
He added, “Energy costs carry broad pass-through effects, transport operators adjust fares, manufacturers face higher input costs, and small businesses contend with increased generator fuel expenses.
Nigeria’s 2025 budget had a shortfall of N30 trillion from a projected N40 trillion, with the government carrying over 70 percent of the capital component into 2026. Against that backdrop, an oil windfall is not merely welcome; it is politically essential.
But economists and energy analysts warn that the same price shock doing the giving can quickly start taking away.
Read also: Oil prices set for swings next week as US and Israeli attacks on Iran squeeze supply
Nigeria’s post-subsidy era means domestic pump prices are now closely tethered to global crude benchmarks. When international crude climbed earlier this year, the Dangote Refinery raised its gantry price by 14.3 percent, and retail stations followed, with some pumps in northern Nigeria reaching N960 to N980 per litre.
“If price goes above $85 a barrel, we can see petrol prices trade at over N1,000 per litre, more than N1,000,” Kelvin Emmanuel, an energy economist, said on Arise TV on Sunday.
Eric Robertsen, Standard Chartered, global head of research, noted in a weekend assessment that investors had already been underpricing geopolitical risk in emerging markets. Commodity-linked currencies have been outperforming, suggesting markets are paying for exposure to scarce resources and terms-of-trade winners.
The Hormuz Factor
The gravest risk to Nigeria, and the global economy, lies not in what has already happened, but in what Tehran might do next. Iran warned over the weekend that the Strait of Hormuz had been closed to shipping. Vessel tracking data showed that at least three ships turned away from the strait on Saturday, and the number of vessels idling on either side surged as shipowners assessed escalating security risks.
More than 150 freight ships, including many oil tankers, were stalled on either side of the strait by Sunday evening, according to findings by BusinessDay.
War risk insurers moved quickly. On Saturday, underwriters submitted cancellation notices for policies covering ships in the Gulf, an unusual step before markets had even reopened, with coverage prices set to rise by as much as 50 percent. Insurance on a $100 million vessel, previously around $250,000 per voyage, faced jumps to $375,000 or more.
“If Israel and the US are continuing to strike Iran, it’s more likely that Iran will start trying to leverage their control via the manipulation of shipping in the region,” said Dylan Mortimer, marine hull UK war leader at broker Marsh. “The greatest concern among underwriters is whether Iran would close the Strait of Hormuz.”
Ali Vaez, director of the Iran Project at the International Crisis Group, warned that a closure would disrupt roughly a fifth of globally traded oil overnight, and prices would not merely spike; they would gap violently upward on fear alone.
More than 14 million barrels per day flowed through the Strait in 2025, roughly a third of the world’s total seaborne crude exports. About three-quarters of those barrels were destined for China, India, Japan, and South Korea.
Read also: Oil rally from Iran conflict may support naira but inflation risk looms — Yusuf
Maersk suspends operations
Maersk, the world’s largest container shipping company, on Sunday announced that it is suspending vessel crossings in the Strait of Hormuz after reports that it had been closed following US and Israeli attacks on Iran.
“The safety of our crews, vessels and customers’ cargo remains our key priority. We are suspending all vessel crossings in the Strait of Hormuz until further notice,” Maersk announced in a statement.
It also announced that all sailings on Middle East-India to Mediterranean and Middle East-India to East Coast US on services will be rerouted around the Cape of Good Hope until further notice due to the “deteriorating security situation” in the region.
Mediterranean Shipping Company (MSC) also announced suspending “all bookings for worldwide cargo to the Middle East region until further notice.”
