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strait of hormuz

By News Desk

Prime Brief Media | June 18, 2026

ABUJA, NIGERIA — Nigeria's oil revenue outlook may witness a sharp drop over the reopening of the Strait of Hormuz. The US‑Iran war started on February 28 when oil prices were below $70 a barrel. The Strait of Hormuz, one of the world's most critical energy gateways, had been under blockade for four months due to tensions in the Middle East.

But three days ago, a truce was reached among all parties, leading to a ceasefire and the reopening of the channel. While the war lasted, oil prices rose to an all‑time peak of over $120 per barrel, further boosting revenue for Nigeria. The 2026 budget is anchored on daily oil production of 1.8 million barrels per day, a benchmark oil price of $64.85 per barrel and an exchange rate of N1,400 to the dollar.

Actual earnings in March and April exceeded this benchmark, largely due to the sharp rise in crude oil prices. But should the reopening of Strait of Hormuz drive crude prices towards Nigeria's 2026 budget benchmark of $64.85 per barrel as against elevated crisis level of $95 per barrel, the country could lose about N13 trillion in the remaining months of 2026.

Industry observers have warned that while the Hormuz disruption delivered an unexpected windfall to Nigeria, the reopening of the strategic waterway could further expose the country's persistent production challenges.