Nigeria’s Bonny Light crude oil price fell to an average of $66.2 per barrel in October 2025, down 6% month-on-month from $70.2 per barrel in September, according to data from the Central Bank of Nigeria (CBN). The decline marks the third consecutive monthly drop in the country’s benchmark crude, reflecting sustained weakness in global oil prices.
The latest slide underscores how fragile the oil market remains amid a volatile mix of economic and geopolitical tensions. Analysts point to renewed US-China trade friction as a key factor behind weaker demand. The situation escalated after President Trump threatened to impose 100% tariffs on Chinese goods, a move that followed China’s decision to restrict exports of rare earth minerals. These developments sparked worries over global growth, leading investors to brace for softer oil demand in the months ahead.
Beyond demand concerns, the market is also grappling with oversupply pressures. The bearish sentiment deepened after OPEC+ decided to unwind voluntary production cuts, adding 137,000 barrels per day in October. While modest compared with previous adjustments, the increase nudged overall supply higher, weighing further on crude prices.
Adding to the imbalance, non-OPEC+ producers, particularly the United States, ramped up output. Rising US oil inventories signaled expanding supply, dampening market optimism and keeping prices under pressure. These combined factors contributed to the downward trajectory of Bonny Light, which serves as a key source of Nigeria’s foreign exchange earnings.
Despite the slump, oil prices briefly rebounded late in October. This was driven by a new trade framework between the US and China, which temporarily eased investor concerns. In parallel, US sanctions on Russia’s two largest oil producers rekindled geopolitical risks, creating short-lived bullish signals in the global oil market.
Looking ahead, OPEC+ plans to implement another 137,000 barrels per day increase in December, a move aimed at reclaiming global market share. However, the group’s strategy could flood the market further, keeping crude prices under downward pressure through year-end.
For Nigeria, extended periods of sub-$70 oil prices raise red flags for fiscal stability. Prolonged softness, especially below $60 per barrel, could shrink FX inflows from oil revenues and limit the government’s fiscal space for spending. This trend highlights the fragile link between global oil dynamics and Nigeria’s macroeconomic outlook.