By Our Correspondent
Global crude oil prices plunged by more than four per cent on Monday as renewed diplomatic efforts to end the US-Israeli war on Iran eased concerns about prolonged disruptions to global oil supplies.
Brent crude futures dropped by 4.5 per cent to $118.30 per barrel, while the United States benchmark, West Texas Intermediate (WTI), declined by 4.37 per cent to $99.57 per barrel, according to market figures reviewed by Nairametrics.
The decline followed three consecutive days of diplomatic engagements involving Iranian and Qatari officials, raising hopes of progress towards ending the conflict and restoring stability in the Middle East.
The renewed negotiations have strengthened expectations that a possible agreement could prevent further military escalation, protect energy infrastructure and minimise disruptions to international crude oil shipments.
Iranian Foreign Minister Abbas Araqchi said on Sunday that discussions with Qatari mediators were ongoing and progressing. However, he maintained that Tehran remained prepared for both diplomatic negotiations and defence.
The United States has also indicated a preference for a diplomatic resolution.
Axios, citing unidentified sources, reported that President Donald Trump told Israeli Prime Minister Benjamin Netanyahu that he wanted diplomatic efforts to run their course before considering further military action.
Similarly, US Secretary of State Marco Rubio said on Saturday that no decision had been taken on additional attacks, stressing that Trump favoured resolving the conflict through diplomacy.
The developments have eased immediate market concerns about further escalation, although uncertainty persists over the security of energy infrastructure and critical shipping routes in the region.
A major concern for oil traders remains the Strait of Hormuz, a strategic maritime corridor through which a significant portion of the world’s petroleum supplies passes. Any prolonged disruption along the route could constrain global oil supplies and trigger another surge in prices.
Monday’s decline came after a strong rally in crude oil prices throughout October, driven by escalating tensions involving the United States, Israel and Iran, alongside fears of disruptions to oil production and exports.
On October 30, Brent crude traded at $117.30 per barrel, gaining 2.14 per cent, while WTI advanced by $1.85 to $103.80 per barrel, according to Nairametrics’ market checks.
The October rally was largely attributed to concerns over attacks on energy infrastructure, threats to international shipping routes and the possibility of a wider regional conflict affecting oil production and exports.
Further uncertainty followed renewed attacks claimed by Yemen’s Houthi movement against Saudi Arabia’s energy infrastructure.
The group’s spokesperson, Yahya Saree, announced on X that the Houthis had targeted several strategic facilities, heightening concerns about the security of oil-producing countries in the Middle East.
The prospect of a diplomatic breakthrough has introduced a new dimension to the oil market, with investors balancing expectations of improved supply conditions against the continuing threat of military escalation.
However, the latest decline in international crude prices may not immediately translate into lower petrol prices and other domestic energy costs, particularly in markets where exchange rates, transportation, refining and distribution expenses remain significant.
In Nigeria, energy inflation more than doubled to 10.85 per cent year-on-year in September 2026, compared with 4.69 per cent in August, according to the National Bureau of Statistics (NBS).
The increase highlights the exposure of households and businesses to energy-price fluctuations, particularly through transportation, manufacturing, logistics and electricity generation costs.
For businesses operating in energy-intensive industries, higher fuel and electricity expenses translate into increased production costs, reduced profit margins and potentially higher prices for consumers.
Meanwhile, volatility in international oil markets has prompted some governments to strengthen domestic energy security by restricting exports and prioritising local supplies.
In October 2026, Niger imposed a ban on petrol and diesel exports to protect domestic availability. However, specially authorised exports of surplus petroleum products by state-owned SONIDEP and refinery operator SORAZ remained exempted.
The measure reflects growing concerns among governments about maintaining adequate domestic fuel supplies amid uncertainty in global energy markets.
Similarly, a September 2026 policy brief by the United Nations Development Programme (UNDP) projected that global fossil-fuel subsidies could exceed $1 trillion in 2026 as governments absorb part of the energy-price shock to shield households and businesses.
For Nigeria, fluctuations in international crude oil prices have implications beyond the petroleum sector, given the close relationship between energy costs, domestic inflation, manufacturing competitiveness and transportation expenses.
Although a sustained decline in crude oil prices could ease some economic pressures, the extent of the benefits will depend on developments in the domestic petroleum market, exchange rate movements and the stability of international supply chains.
The latest price decline therefore reflects a reassessment of geopolitical risks rather than a definitive end to concerns about global oil supplies.
Until a lasting diplomatic agreement is secured and security improves across critical shipping routes, international crude oil prices are expected to remain sensitive to developments in the Middle East.
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