US-Iran War: Oil prices drop 5.5%, raising hopes of cheaper petrol

By Obas Esiedesa, Abuja

Crude oil prices fell by 5.5 per cent on Monday to about $97.6 per barrel amid growing optimism over a possible peace agreement between the United States and Iran aimed at easing tensions around the Strait of Hormuz, a critical global oil transit route.

Brent crude, the international benchmark, slipped below the $100 per barrel mark after weeks of volatility triggered by the conflict, which disrupted oil supplies moving through the Strait of Hormuz, a channel that handles about one-fifth of global crude trade.

The price decline followed comments by US President Donald Trump, who said a deal with Iran was “largely negotiated,” although he stressed that any final agreement must be “great and meaningful,” warning that otherwise there would be “no deal.” Trump said discussions were centred on reopening the Strait of Hormuz and ensuring broader regional stability.

US Secretary of State Marco Rubio also expressed cautious optimism, saying progress had been made in negotiations but noting that major disagreements remained unresolved. Rubio maintained that any arrangement permitting Iran to impose a tolling system on vessels using the Strait of Hormuz would make a diplomatic agreement unacceptable.

The sharp drop in crude prices has raised hopes of possible relief for Nigerian motorists grappling with high petrol prices.

Petrol currently sells for between N1,250 and N1,400 per litre across different parts of Nigeria, depending on location and marketer. Prices in Abuja and parts of Northern Nigeria are above N1,360 per litre, while some remote and border communities are recording prices approaching N1,400 per litre.

The recent increases followed adjustments in refinery and depot prices driven by rising crude oil costs.

The Major Energies Marketers Association of Nigeria (MEMAN) reported two days ago that the petrol gantry price at Dangote Refinery stood at N1,275 per litre, while the coastal price was N1,215 per litre. The association estimated import parity into tank at N1,230.34 per litre.

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