Oil prices return to pre-war levels 4 months after US-Iran tensions

Exactly four months after tensions between the United States and Iran escalated, global crude oil prices have fallen back to levels seen before the conflict. Brent crude traded at $72.32 per barrel on Wednesday morning as shipping activity through the Strait of Hormuz continued to recover.

Brent crude, Nigeria’s benchmark grade, climbed above $100 per barrel in April at the height of the conflict, pushing petrol prices in Nigeria beyond N1,000 per litre. The temporary closure of the Strait of Hormuz by Iran, a key global route for oil and gas exports, disrupted energy supplies and drove crude prices sharply higher.

Oil prices, however, have declined steadily since the United States and Iran signed a Memorandum of Understanding (MoU) on June 17. The agreement established a 60-day framework for negotiations on Tehran’s nuclear programme and other measures to end hostilities.

Before the conflict began in early 2026, global crude oil prices were trading at about $72.48 per barrel, leaving current prices almost exactly where they were before the outbreak of the crisis.

The easing in crude prices has also begun to filter through to Nigeria’s downstream market. Major suppliers, including Dangote Refinery and the Nigerian National Petroleum Company (NNPC) Limited, have announced reductions in their ex-depot prices, providing modest relief for motorists.

Despite the decline in oil prices, with West Texas Intermediate (WTI) trading at $70.75 per barrel, Pratibha Thaker, Regional Director for the Middle East and Africa at the Economist Intelligence Unit, cautioned that the market remains vulnerable to renewed geopolitical risks.

“Markets are still watching the region closely, and any renewed tensions could quickly send oil higher again,” she said.

Maritime intelligence firm Kpler reported that shipping traffic through the Strait of Hormuz has increased significantly since the MoU was signed. Nevertheless, vessel movements remain below the levels recorded before the conflict, when more than 100 ships passed through the waterway each day.

Since June 18, the day after the agreement was reached, 284 vessels have transited the strait. Even so, this remains below the pre-conflict average of around 138 vessel crossings per day.

The vessels using the route include tankers transporting crude oil, liquefied natural gas, fertilisers and other commercial cargo, reflecting the gradual restoration of trade through one of the world’s most strategic shipping corridors.

The US Navy has also issued navigation guidance, directing vessels through a southern passage considered safer from mines and other hazards left behind during the conflict.

Across Nigeria, petrol continues to retail between N1,100 and N1,400 per litre, depending on location and marketer. However, the Federal Government has urged oil marketers and refiners to implement further price reductions to reflect the sustained decline in global crude oil prices.