Oil prices drop as Middle East tensions ease

Global oil prices experienced a notable decline of approximately $3 on Thursday, driven by investor optimism surrounding a potential easing of tensions in the Middle East. Hopes for a broader ceasefire deal have fueled expectations of diplomatic breakthroughs, potentially leading to the reopening of the Strait of Hormuz.

Brent crude futures fell by 3.27% to $94.61 per barrel, while US West Texas Intermediate crude dropped by 3.86% to $92.31 per barrel. These benchmarks had previously risen due to renewed Middle East tensions, including reported Iranian attacks and U.S. military strikes near the Strait of Hormuz. Reports suggest Iran has made any agreement conditional on an end to hostilities between Israel and Hezbollah.

In the United States, the House of Representatives passed a resolution aimed at blocking former President Donald Trump from continuing military action against Iran, though Senate approval and a veto override would be necessary. Meanwhile, Russia's Deputy Prime Minister acknowledged a decline in Russian oil production due to unplanned refinery maintenance.

In contrast to the global trend, Nigeria's National Petroleum Company Limited reported a more than 70% increase in revenue and profit. The Dangote refinery also benefited from high fuel exports. However, the masses in Nigeria continue to endure higher fuel prices, contributing to inflationary pressures.