Crude oil prices nosedived on Saturday, fuelling concerns of a looming crash in Nigerian depot prices as global economic uncertainty deepens following the United States’ sweeping new tariffs.
Brent crude sank by 4.33% to $62.74 per barrel, while WTI crude fell to $59.17, marking a 4.55% drop. Murban crude also slid by 5.33%, closing at $64.09. Meanwhile, natural gas prices slipped by 2.29%, now trading at $3.749.
The sharp decline comes amid fears that a slowdown in global trade sparked by U.S. President Donald Trump‘s aggressive tariff policies will stifle fuel demand in key markets. For Nigerian importers and depot operators, the concern is immediate: that the dip in global benchmarks will trigger a cascading price drop at local petroleum depots.
“The knock-on effect of this oil price slump could be felt acutely in Nigeria, where depot margins are already thin,” said a senior Lagos-based downstream analyst. “A prolonged dip could force major players to reassess pricing models at Apapa, Calabar, and Port Harcourt depots.”
Global Ripples, Local Impact
Though crude oil was not directly hit by the new tariffs, energy markets were spooked by the broader economic implications. The International Monetary Fund (IMF) has issued warnings over the impact on global growth, stating that the tariffs represent a “significant risk” during an already fragile recovery period.
Bloomberg’s Julian Lee wrote that while the tariffs do not target oil, the biggest buyers especially across Asia face the brunt of the economic slowdown, leading to weaker demand for crude. For Nigeria, whose depots rely on steady imports and favourable forex rates, this spells trouble.
“Nigerian depot operators could face pricing pressure due to falling landing costs, yet may still struggle to transfer benefits to end-users amid logistical and forex constraints,” said a downstream logistics expert.
Saudi Arabia Cuts Prices
In a move that intensified bearish sentiment, Saudi Arabia slashed its official selling prices (OSPs) for key markets, signalling potential oversupply ahead of anticipated output increases. For Nigerian importers, this might present a window for cheaper bulk purchases, but risks undercutting domestic margins if demand remains weak.
Trade Tensions vs Oil Resilience
While White House officials framed the tariffs as part of a strategy to re-industrialise the U.S., analysts see them as a high-stakes gamble. “This is more about leverage than long-term policy,” said Henry Hoffman, of the Catalyst Energy Infrastructure Fund. “The risk is that emerging markets like Nigeria will bear the unintended consequences.”
China, the world’s largest crude importer, is reportedly preparing stimulus packages instead of retaliatory tariffs, suggesting that major economies may attempt to shield domestic energy markets. However, Nigerian traders worry that depressed global demand could still ripple through to West African shores.
Market Snapshot – 6 April 2025
- Brent Crude: $62.74 ▼4.33%
- WTI Crude: $59.17 ▼4.55%
- Murban Crude: $64.09 ▼5.33%
- Natural Gas: $3.749 ▼2.29%
As oil markets continue to digest the macroeconomic shifts, the Nigerian downstream sector braces for potential price corrections, logistical recalibrations, and tighter margins at key depots nationwide.
