FG's $64.85 oil budget benchmark exceeded as Bonny Light hits $71 amid geopolitical risks
Nigerian crude oil, specifically Bonny Light, traded at $71 per barrel on February 26, 2026, surpassing the Federal Government's 2026 budget benchmark of $64.85. This 0.7% increase from Monday's $72.3 reflects heightened geopolitical risk premiums, particularly related to US-Iran tensions and Red Sea security concerns. The US Energy Information Administration projects global oil inventories could rise by 3.1 million barrels daily this year, potentially balancing or oversupplying the market. Nigerian crude's appeal lies in its low sulfur content and high API gravity, making it cheaper to refine into diesel and gasoline. The Dangote Refinery's success in achieving 661,000 bpd capacity has boosted domestic fuel self-sufficiency, reducing crude exports. However, crude theft and pipeline vandalism remain significant revenue losses despite recent declines. Attention now turns to the American Petroleum Institute's weekly crude stock data for short-term price direction.