Oil drops below $90 as US-Iran war nears end, threatening Nigeria's revenue

Brent crude fell 3.1% to $89.66 a barrel Tuesday, dropping under $90 for the first time since August as diplomatic momentum builds to end the eight-month US-Iran war. West Texas Intermediate slid 2.3% to $84.86. President Trump declared Iran "militarily, effectively over" and cited "positive momentum" after meeting Qatar's prime minister, though he kept strikes as an option.

Iran's Foreign Minister Abbas Araghchi said Tehran will reopen the blockaded Strait of Hormuz within two days if the US meets conditions: end the war on all fronts, unfreeze Iranian assets, lift oil sanctions, and end the counter-blockade of Iranian ports. Qatar and Pakistan are mediating.

For Nigeria, this is a direct hit to the 2026 budget benchmark of $77.96/barrel. Every $10 drop below benchmark costs the federation roughly ₦1.2 trillion in projected revenue. The 2025 budget already assumed $75/barrel; sustained prices in the $80s ease that pressure but $90+ was funding the 2026 spending plan. Lower global prices eventually translate to lower petrol landing costs—potential relief at the pump if the naira stabilizes.

Finance Minister Wale Edun and CBN Governor Yemi Cardoso face a narrowing revenue window. The 2026-2028 MTEF will need revised assumptions. Oil-dependent states (Rivers, Delta, Bayelsa, Akwa Ibom) should brace for reduced FAAC allocations.

Will the Federal Government adjust the 2026 budget now, or borrow to cover the gap while hoping prices recover?

SOURCE: https://www.channelstv.com/2026/11/10/brent-drops-below-90-on-us-iran-peace-hopes/