Nigeria’s Bonny Light crude steadied at $65.77 per barrel after a three-week slide that has pulled prices to their weakest levels in months, reflecting mounting concerns over global oversupply.
The grade, which traded between $66 and $67 in late November, has averaged about $65.5 so far in December—well below September’s $70.20 and significantly under Nigeria’s 2025 budget benchmark of $75 per barrel, intensifying pressure on government revenues.
Brent crude hovered slightly above $62 per barrel after a 2 per cent drop on Monday, while West Texas Intermediate drifted near $59. Traders now await updates from the International Energy Agency and OPEC later this week, alongside the US Energy Information Administration’s Short-Term Energy Outlook.
Forecasts suggest that 2026 could deliver one of the biggest supply gluts in years. The IEA projects a surplus of more than 4 million barrels per day next year, with inventories widening through late 2025. Non-OPEC producers such as Brazil and the United States continue to expand output, adding to the pressure.
Nigeria’s own production rose marginally to 1.40 million barrels per day in October, but remains far below the government’s two-million-barrel target for 2025.
The growing imbalance has pushed Brent and WTI futures deeper into contango, with prompt deliveries priced lower than contracts for later in the year. Market expectations now see Brent averaging around $57 per barrel in 2026, assuming Russian supplies remain largely uninterrupted despite sanctions.
Brent eased 0.3 per cent to $62.31 for February settlement, while WTI slipped 0.4 per cent to $58.66 for January deliveries.
Traders are also watching shifts in demand from India, the biggest buyer of Russian seaborne crude, which is preparing to pare back purchases. The matter is expected to feature prominently in India’s talks with US officials this week. Meanwhile, Ukraine’s continued attacks on Russia’s energy infrastructure could influence supply flows into global markets.
