‘Nigeria May Benefit from Oil Price Spike Amid Middle East Tensions’

Nume Ekeghe

Nigeria could benefit from the recent spike in global oil prices triggered by escalating tensions in the Middle East, provided authorities are able to contain the inflationary pressures that typically accompany rising energy costs, a market analyst has said.

Senior Market Analyst for Africa at FXTM, Matthew Anthony, in a statement noted that crude oil prices surged to just above $120 over the weekend as the conflict involving Israel, the United States and Iran intensified, with key energy installations reportedly targeted.

The rally was further driven by the effective closure of the Strait of Hormuz, a critical global shipping route through which roughly 20 per cent of the world’s oil supply passes.

Anthony said the development presents a potential fiscal upside for major oil-producing countries such as Nigeria if the country can effectively manage the inflationary impact and deploy the additional revenue toward critical budgetary needs.

He stated: “Major oil producing nations like Nigeria may profit from this conflict provided they are able to put a lid on inflation- a major consequence from rising oil prices-and use the windfall for critical budget needs while preparing for potential market shocks.

“Outside of Nigeria, a wave of risk aversion engulfed global markets on Monday as ongoing conflict in the Middle East accelerated the flight to safety. Asian shares plunged, European markets opened deep in the red while US equity futures signaled to a negative open as investors scrambled to price the chaos from the Iran conflict.”

He added that in the foreign exchange market, the U.S. dollar remained supported by safe-haven demand alongside the Swiss franc. However, the Canadian dollar emerged as the best-performing G10 currency month-to-date, benefiting from its strong correlation with oil prices.

He added: “Gold ended last week in losses despite the risk-off sentiment and overwhelming disappointing NFP report. Non-farm payrolls slid by 92,000, representing the biggest monthly decline in payrolls since October 2025, while the unemployment rate rose to 4.4 per cent.