Nigeria’s economy may face fresh headwinds as the ongoing conflict between Israel and Iran threatens global oil supply, analysts at Comercio Partners have warned.
In their May Macro Report titled “Nigeria’s Inflation Slows in May, But Trouble May Be Ahead”, the firm noted that the geopolitical crisis could lead to supply shocks and a spike in global crude prices. Despite being an oil-producing nation, Nigeria is unlikely to benefit from such price surges.
Since fuel subsidies were removed and prices are now tied to global benchmarks, any increase in oil prices could deepen economic strain. The report explains that even with the Dangote Refinery operational, the country remains exposed, as rising crude prices directly raise production and distribution costs.
Petrol prices, currently hovering around N825 per litre, could jump to N1,000 if oil prices continue climbing, the analysts projected.
This would likely trigger higher transport costs and accelerate inflation, especially in an economy already battling insecurity and climate-related pressures.
Highlighting Nigeria’s unusual dependence on imported crude, the report noted that the country spent N1.19 trillion on crude oil imports in Q1 2025, making it the third most imported commodity after gas oil and petrol.
According to the National Bureau of Statistics, the high import figure reflects a persistent shortfall in domestic crude supply, prompting local refiners to turn to international sources. Brent crude is now trading above $74 per barrel, while Nigeria’s oil blends have crossed $75.
In June alone, oil prices surged over 18%, rebounding from a low of $61 in April. With the Israel-Iran conflict in its fifth day and escalating, prices could push toward $80 if tensions worsen. So far, at least 224 people have been killed in Iran and 24 in Israel, with ongoing airstrikes adding to the volatility in global markets.
