This is the type of news that countries like Nigeria would never want to hear.

But it is here anyways.

As at yesterday (Monday), the global oil benchmark, Brent crude, against which Nigeria’s oil is priced, dropped by $3.18 to $72.15 per barrel as of 8:30PM Nigerian time.

According to data from the International Monetary Fund, IMF showing a slowdown in global economic growth and the potential for United States waivers on Iran oil sanctions, the further decline isn’t unconnected with talks of a possible release from global crude reserves.

“The market is on the defensive because of the potential release of oil from global reserves,” said a senior market analyst at Price Futures Group, Phil Flynn, according to MarketWatch.

Also Read: 3 Things Nigeria Can Do With Increased Oil Revenue Earnings

You see, petrol prices are rising in America and President Donald Trump administration is considering a release from the US Strategic Petroleum Reserve.

The US government is “coming under increased pressure as a result of rising gasoline prices, with national average gasoline prices up almost 16 per cent since the start of the year,” according to analysts at ING Bank.

The Director of the International Energy Agency, Fatih Birol, also said at a private dinner last month that a release from global oil reserves was an option if supply outages worsen, the WSJ reported, citing dinner attendees.

Traders also fretted over a potential slowdown in the global economy, which could hurt demand for oil.

The IMF on Monday said that growth was slowing in the euro area, Japan and the United Kingdom and warned that a further escalation of trade tensions stood as the greatest near-term threat to global growth.

Don't forget to share this story with your loved ones

Also Watch: