The price of Brent, the benchmark for Nigeria’s crude oil hit $30 for the first time since April 15 following an increase in demand as major countries in Europe such as italy and Spain starts relaxing strict economic lockdown.
International Brent crude oil increased by 11 percent to $30.20 on Tuesday afternoon while West Texas Intermediate (WTI) increased by 16 percent to $23.68.
Both WTI and Brent have been advancing for several consecutive days, with the US crude starting its winning streak on April 29 and the latter just one day earlier.
For Africa’s biggest oil-producing country, a rise in oil prices between $50 to $60 would allow the country to earn badly needed foreign exchange to carry out development projects.
The positive sentiment in the energy market comes as the members of the Organization of the Petroleum Exporting Countries (OPEC), as well as allied oil producers, started cutting oil output as a key oil agreement came into force on May 1.
The accord is set to wipe out nearly 10 million barrels per day from the overflowed market, while some countries beyond the agreement have also curbed production to help oil prices rebound.
At the same time, some countries in Europe and Asia, as well as some US states, are slowly lifting some of the coronavirus-related restrictions, giving hope that the demand-supply gap may become smaller.
Italy is leading Europe in easing lockdown measures aimed at containing the spread of the new coronavirus, almost two months after the epidemic hit the continent.
More than 4.4 million Italians went back to work on Monday after seven weeks of extraordinary restrictive measures while the streets of the Greek capital Athens was also filled with resounding noise of car horns after weeks of movement restrictions.
Slovenia, Poland and Hungary joined Germany in allowing public spaces and businesses to partially reopen.
DIPO OLADEHINDE
