Brent crude traded at $77 per barrel, the highest hit in two months over supply constraints and dip in crude inventories of the United States.
This development means an increase in revenue for Nigeria and a challenge for the country’s subsidy shortfall payments.
The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) recently said the supply crisis affecting the natural gas market might push crude oil prices up by $10 a barrel
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The Brent crude oil futures, global oil benchmark, rose to 0.26 percent to $77.55 a barrel by 10:15 am on Friday.
This is the highest trading price since July 5, when the global oil benchmark traded $77.16 per barrel.
Also, the U.S. West Texas Intermediate (WTI) crude oil futures also witnessed a corresponding increase of 0.11 percent to $73.38 a barrel.
Experts at UBS told Reuters that Brent oil price could hit $80 a barrel by the end of September due to stock draws, lower OPEC production and stronger demand in the Middle East.
“What still might allow Brent to hit that mark over the coming weeks is the ongoing drop in oil inventories driven by unplanned supply disruptions,” the analysts said.
Analysts said that rising prices of natural gas were also attracting the rise as the supply shortage of gas could encourage power utilities to shift from gas to oil if winter turns out to be colder this year.
