OIL PRICE FALLS TO $74, NIGERIA'S EXPORTS SUFFER

The international oil benchmark, Brent crude, on Tuesday continued its biggest losing streak since February, falling below $75 per barrel.

The downturn in oil prices came on the heels of worries that Saudi Arabia and Russia could pump more crude to compensate for a potential supply shortfall, with hedge funds reducing bullish positions in crude. Brent, against which Nigerias crude oil is priced, dropped to $74.89 per barrel as of 6:40pm Nigerian time, while the United States West Texas Intermediate slumped by $1.50 to $66.38 per barrel.

Following the rally in crude oil prices, the National Assembly increased the oil benchmark price for the 2018 budget to $51 per barrel from $45 proposed by the Executive. The Brent price has fallen nearly seven per cent since hitting $80.50 on May 17, its highest since November 2014. Ahead of the Organisation of the Petroleum Exporting Countries meeting in Vienna on June 22, concerns that Saudi Arabia and Russia could boost output have exerted downward pressures on oil prices, along with rising oil production in the United States. Saudi Arabia and Russia have discussed raising OPEC and non-OPEC oil production by one million barrels per day to counter potential supply shortfalls from Venezuela and Iran.

Meanwhile, loading delays at Nigerias Forcados terminal have pushed above two weeks, according to market sources, with no official new loading programme for June or July released by the terminals operators, Platts reported on Tuesday. Flows to the Forcados terminal reportedly resumed last week after repairs were made to correct a minor leak on the Trans-Forcados pipeline.

(Punch)