Global crude oil prices have taken a significant hit, sliding by over 12% to around $65.50 per barrel, in the wake of sweeping new trade tariffs imposed by U.S. President Donald Trump on multiple countries.
The sharp decline marks a notable reversal from recent highs, as oil had been trading above $70 per barrel before the tariffs were announced. The development has raised alarm bells for oil-dependent economies like Nigeria, which relies on crude exports for 90% of its foreign exchange earnings.
According to the OPEC Secretariat, the price of its basket of twelve crude blends dropped to $75.35 per barrel on Thursday, down from $77.44 the previous day, reflecting mounting pressure in global markets.
In response to the volatility, the Central Bank of Nigeria (CBN) stepped in to cushion the impact on the local economy. In a circular released Sunday, the apex bank confirmed it facilitated market activity on Friday by injecting $197.71 million through authorized dealers in the foreign exchange market.
The CBN described the move as part of its ongoing effort to ensure “adequate liquidity and support orderly market functioning.”
“This measured step aligns with our broader objective of fostering a stable, transparent, and efficient foreign exchange market,” the statement read.
The bank also noted that fluctuations in the forex market between April 3 and 4, 2025, were influenced by “broader global macroeconomic shifts currently affecting several Emerging Market and Developing Economies.”
“These developments were as a result of the recent announcement of new import tariffs by the United States government on imports from several economies, which has triggered a period of adjustment across global markets,” the CBN added.
“Crude oil prices have also weakened – declining by over 12% to approximately US$65.50 per barrel – presenting new dynamics for oil-exporting countries such as Nigeria.”
The evolving global economic environment, coupled with price instability in the oil market, signals turbulent times ahead for Nigeria’s foreign exchange reserves and budgetary planning. As the country braces for potential revenue shortfalls, attention now turns to how policymakers will navigate the uncertainty.
Meanwhile, New Daily Prime earlier reported that Brent crude oil recorded the lowest price for the first time in four years as the price fell to $65.58 per barrel last Friday.
The worldwide oil benchmark fell by 7 per cent to trade at $65.58, making it lowest since April 2021.
The United States West Texas Intermediate (WTI) also fell by 7.35 per cent to 62.03 per barrel.
WHY THE DROP
The price of crude oil dropped following China’s increased tariffs on US goods in a retaliatory move, sharply intensifying a global trade war that has investors worried about a recession.
President Donald Trump, on April 2, announced sweeping global tariffs on all imports into the US, imposing 14 per cent on Nigeria.
The approach described as “Liberation Day,” is intended to counteract what Trump’s administration sees as unfair trade practices.
Trump on Wednesday announced new blanket tariffs of 10 per cent on most imports to the U.S., with higher penalties based on trade deficits for many countries.
Meanwhile, Ngozi Okonjo-Iweala, the Director-GeneraI of the World Trade Organisation (WTO), disclosedthat the recent tariffs announced by the US will have significant implications for global trade and economic growth prospects.
The drop in oil prices also follows an increase in oil production by the Organisation of Petroleum Exporting Countries (OPEC) and its allies (OPEC+).
