Expectations of relief from Nigeria’s high petrol prices have increased after Brent crude fell towards $100 per barrel, supported by signs of stronger Saudi oil exports through the Strait of Hormuz and renewed hopes of diplomatic progress in the Iran conflict.
Brent, the global oil benchmark, declined for a fourth consecutive session and settled 3.4 per cent lower. The October West Texas Intermediate contract, which expires on Tuesday, fell by approximately 4.5 per cent.
The decline could ease pressure on petrol prices in Nigeria, where higher global crude costs have contributed to a sharp increase in the price of petroleum products and intensified the cost-of-living crisis.
Satellite data showed that Saudi Arabia’s oil loadings from inside the Persian Gulf rose significantly over the weekend. The number of vessels observed at the country’s main Gulf port was the highest since June.
The data suggested that Saudi Arabia was successfully redirecting exports through the Gulf after drone attacks disrupted its East-West pipeline.
Saudi oil shipments through the Strait of Hormuz averaged approximately 2.9 million barrels per day over the six days to 18 September, compared with about 700,000 barrels per day in August, according to satellite data cited by JPMorgan.
Admiral Brad Cooper, head of US Central Command, also said crude-oil and liquefied-natural-gas flows through the strait had reached a six-month high over the previous two weeks.
The improving shipping flows and possibility of diplomatic engagement have eased some concerns about a prolonged disruption to global oil supplies.
US President Donald Trump told Fox News that he would probably be open to meeting Iranian President Masoud Pezeshkian during the United Nations General Assembly in New York this week.
The possibility of talks has raised expectations that diplomatic efforts could reduce tensions and improve the movement of oil through the Strait of Hormuz.
Arne Lohmann Rasmussen, chief analyst at A/S Global Risk Management, said market attention had shifted towards improving oil and LNG flows through the waterway and possible diplomatic progress.
“The worst pressure on crude may be easing,” he said.
However, supply risks remain. Saudi Arabia issued air-raid alerts for Riyadh and warnings in Red Sea locations, including Yanbu, following continued attacks by Houthi forces.
Libya’s largest oil field also reduced production after an armed group reportedly shut down a pipeline. The National Oil Corporation warned that a prolonged closure could disrupt production, transportation and exports from the Sharara field.
Oil prices have risen by more than 65 per cent this year, while diesel remains at the centre of the global fuel shortage. US diesel prices rose above $6.50 per gallon before futures declined by about three per cent on Monday.
In Nigeria, petrol prices have risen to record levels despite the Dangote Refinery operating at its full capacity of 700,000 barrels per day.
Reuters checks showed that petrol was selling for about ₦1,400 per litre in Lagos and Abuja, compared with approximately ₦1,200 a month earlier. Some filling stations in northern Nigeria were reportedly selling the product for as much as ₦1,500 per litre.
Diesel prices had climbed above ₦2,000 per litre.
The increase followed Dangote Refinery’s decision to raise its wholesale gantry price to ₦1,350 per litre in response to higher crude-oil costs.
The development has highlighted the limits of domestic refining in shielding Nigerian consumers from international oil-market shocks, even as the country’s largest refinery supplies fuel locally.
The rising cost of petrol has added to political pressure on President Bola Ahmed Tinubu’s administration less than six months before the 2027 general election.
Opposition parties have made fuel prices a major measure of the government’s economic performance.
The increase has also revived debate over the removal of the petrol subsidy. While investors have praised the reform, critics say it has worsened the cost-of-living crisis and reduced household purchasing power.
President Tinubu has maintained that the government will not return to the subsidy system.
Jordan Lawrence, Chief Executive Officer of Damisa Technologies, said fuel prices had become a measure of the wider cost-of-living situation.
“Fuel pricing tends to function as a proxy for the broader cost-of-living debate, and sustained increases raise the political premium on demonstrating that reform is delivering offsetting benefits,” he said.
The development comes as Dangote Refinery has begun offering shares to the public to raise funds for its planned expansion.
Although the initial public offering has generated significant interest among Nigerians seeking to invest in the refinery, consumers continue to face higher prices at filling stations.
The President of the Nigeria Labour Congress, Joe Ajaero, called for additional wage support and increased supply of naira-denominated crude to the refinery to help moderate further price increases.
He said the rising costs were deepening poverty and placing additional pressure on Nigerian households.
Analysts warned that higher petrol prices could slow the recent improvement in inflation. Headline inflation eased marginally from 15.43 per cent in July to 15.39 per cent in August, while food inflation remained significantly higher at 19.57 per cent.