The price of Brent crude hit $70 per barrel on Tuesday on the back of an improved demand outlook.
The Brent crude recorded a 1.1 percent rise, making it the highest since March 8, while U.S. crude futures briefly hit $67 a barrel. The global benchmark has not had a sustained period above $70 since 2019.
Crude oil price had been on serious decline globally in the wake of the coronavirus pandemic.
The decline in oil prices affected several economies globally, particularly countries like Nigeria which depend largely on crude oil earnings.
Despite contributing eight percent to Nigeria’s gross domestic product (GDP), crude oil accounts for over 90 percent of Nigeria’s foreign exchange earnings.
Oil prices have been showing signs of recovery amid vaccine roll out.
The 2021 budget, which was signed by President Muhammadu Buhari on December 31, 2020, was based on an oil price benchmark of $40 per barrel and a production level of 1.86 million barrels per day.
Meanwhile, the Wall Street bank had rightly forecasted that the price of Brent crude would rise to $70 per barrel (bbl) in second quarter of 2021 from the $60 previously projected.
Goldman Sachs, a US investment bank and financial services company, had also projected that oil prices will rebound to $75 by the third quarter of 2021.