Follow Us on Google
•Trump’s Venezuela deal rattles markets
By Uche Usim
Oil prices slid on Wednesday after markets reacted to United States President, Donald Trump’s announcement that Venezuela will supply between 30 million and 50 million barrels of crude oil to the United States, a move expected to boost global supply. Brent crude fell about 0.38 per cent to $60.56 a barrel by 17:00 WAT, while US West Texas Intermediate (WTI) crude dropped 1.17 per cent to $56.46 a barrel. Analysts attributed the decline to the anticipated increase in US supply following Trump’s statement.
Trump’s comments, which included plans for Venezuela to turn over the oil and ship it directly to US docks at market prices, injected uncertainty into global oil markets as traders reassessed supply dynamics.
For oil‑dependent economies such as Nigeria, the drop in crude prices presents a looming challenge. The country’s 2026 federal budget, presented by President Bola Tinubu, is based on a crude oil benchmark of $64.85 per barrel, higher than current market levels, raising concerns about revenue projections and budget execution.
In his budget presentation on December 19, 2025, Tinubu outlined a N58.18 trillion spending plan anchored on a $64.85 per barrel oil price, projected crude oil production of 1.84 million barrels per day, and an exchange rate of N1,400 to the U.S. dollar. The budget carries a deficit of N23.85 trillion, equivalent to 4.28 percent of GDP.
With crude trading below the benchmark, Nigeria’s fiscal outlook could be pressured further, potentially widening deficits and complicating government efforts to fund key programs. Economists warn that persistent low prices may compel policymakers to revisit assumptions or seek alternative revenue measures to shore up the budget.
The evolving geopolitical situation in Venezuela and its impact on oil flows will likely remain a key factor influencing oil markets and fiscal planning for oil‑exporting countries in early 2026 and beyond.
