Hormuz Closure Dashes Hopes of Petrol Price Drop in Nigeria

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Hopes of a reduction in petrol prices in Nigeria have dimmed following Iran’s decision to reclose the Strait of Hormuz, a key global oil transit route, barely 24 hours after it was reopened.

Iran shut the strategic waterway again on Saturday, citing continued blockade of its ports by the United States, after it had briefly reopened on Friday under a ceasefire agreement between both countries. The Iranian military said control of the strait had returned to its previous state, with reports indicating that Iranian gunboats fired at a merchant vessel attempting to pass through.

The development has disrupted earlier projections by fuel marketers, who had anticipated a drop in petrol prices from about N1,250 to around N900 per litre following the initial reopening of the strait.

Speaking on Sunday, the spokesman of the Petroleum Products Retail Outlet Owners Association of Nigeria, Joseph Obele, said the renewed closure had stalled expectations of a price reduction. He noted that current prices would likely remain until a lasting ceasefire is reached between Iran and the United States.

Obele had earlier stated on Friday that crude oil prices dropped after the strait reopened, expressing optimism that petrol prices could fall below N1,000 per litre, recalling that the product sold for about N800 before the crisis began on February 28.

Meanwhile, United States President Donald Trump accused Iran of violating the ceasefire agreement by attacking vessels in the Strait of Hormuz. He warned that the US could target Iranian energy infrastructure if Tehran fails to agree to terms to end the conflict.

Trump also disclosed that negotiators are expected to arrive in Islamabad, Pakistan, on Monday evening for further talks, with the current two week ceasefire set to expire on Wednesday.

Despite the renewed tension, global oil prices have not surged significantly. Brent crude traded at 90 dollars per barrel on Sunday, up slightly from 88 dollars before the reclosure, but still below 95 dollars recorded on Friday morning.

The Strait of Hormuz handles about 20 per cent of globally traded oil, making its status critical to international energy markets and domestic fuel pricing in Nigeria.

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