BY AHMED TURAKI, with agencies’ reports
Following the signing of a ceasefire agreement between the United States of America and Iran, which is expected to end hostilities in the Middle East and reopen the Strait of Hormuz, Oilprice.com on Monday reported that the price for Brent crude had dropped from $87 per barrel on Sunday to $83 per barrel on Monday. With the fall in crude oil prices, fuel prices in Nigeria may drop to N900 per litre.
The announcement by US President Donald Trump that a peace deal and a partial reopening of the Strait of Hormuz are likely to take place soon led to a fall in oil prices and is likely to result in lower fuel prices in Nigeria in the coming days.
Crude oil, which traded above $120 per barrel in April, had already fallen to about $87 per barrel as of Sunday and further to $83 per barrel on Monday. Crude oil, the major feedstock for fuel production, rose from below $70 per barrel after the US-Iran conflict began on February 28. During the more than three months of hostilities, crude oil traded above $100 and at times exceeded $120 per barrel, leading to a sharp increase in global fuel prices. It is expected that this trend will now reverse following the latest developments.
According to Reuters, a US official said the memorandum of understanding was signed by Trump, Vice President JD Vance and Iranian parliament speaker Mohammad Bagher Qalibaf. Trump said the text of the deal would be released after a formal signing on Friday. The US stated that the deal provides for the immediate opening of the Strait of Hormuz and the lifting of the US blockade on Iran.
The agreement, according to reliable sources, would extend a ceasefire for a 60-day negotiation period, during which contentious issues such as the future of Iran’s nuclear programme are expected to be decided. A senior US official, according to Reuters, disclosed that the United States was prepared to release frozen Iranian funds.
“We are prepared to give these sanctions, and we’ll do some small gestures of that in the beginning. If they make small gestures toward us that show they’re willing to meet their commitments as well. Those will be kind of small and easy to see the cards, but that’ll be based on performance. We’re going to get together this week and talk about what we want to do and when we do it,” the source said.
Before the deal was announced, a senior Iranian official told Reuters that, under the draft terms, the United States agreed to release $25bn in frozen Iranian assets.
