Crude Oil Price Plummets to $84 Per Barrel

In the ever-volatile world of oil prices, a quick glance at the charts on Friday, 6th of October, revealed Brent crude hovering at $84.21 per barrel around 6:17 AM. 

Despite an uptick in prices, this week has been marked by concerns and a looming worldwide economic slowdown, posing challenges for the oil market.

The week’s turbulence stems from a sell-off in the United States bond market, which has ignited apprehensions about dwindling global economic growth and a potential decrease in fuel demand. 

To put it in numbers, Brent futures were up 26 cents, or 0.3%, at $84.33 at 0358 GMT on Friday, while U.S. West Texas Intermediate crude futures saw a 28-cent rise, or 0.3%, to $82.59, recovering modestly from a 2% dip on Thursday.

What Analysts say about the crude oil price

Analysts like Edward Moya, an expert at OANDA, weighed in on the situation, stating, “Oil prices are stabilizing after a brutal week that saw a relentless bond market selloff trigger global growth worries.” 

However, he also noted that “The worst week for crude since March is starting to attract buyers given the oil market will still remain tight over the short-term.”

Causes and impact of the surge

It’s important to put this recent development into perspective, especially considering that on the 28th of September, Brent crude reached a peak of $97.24 per barrel, a milestone not seen since November 2022. 

This substantial price surge can be attributed to surging demand and a noticeable drop in global crude oil supply.

Within the Nigerian context, global crude price fluctuations have triggered challenges. 

Discussions at the National Executive Council meeting of the Natural Oil and Gas Suppliers Association of Nigeria revealed that Nigerian depots are running low on petroleum products due to the escalating landing costs at N720 per litre. 

Also, depot owners are grappling with soaring crude oil costs and exchange rate volatility, hindering their access to necessary bank loans.