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Bonny Light, one of Nigeria’s benchmark crude oil grades, traded between $12 and $13 per barrel between Monday and Friday.
According to Bloomberg this price is $15 lesser than the dated price of Brent crude, the global benchmark of crude oil which traded at $28 on Friday.
Bonny Light is one of Nigeria’s crude grades. Other grades are Forcados, Qua Iboe and Brass River.
Restrictions imposed by various governments across the world to contain the coronavirus pandemic has led to the closure of factories and refineries and in turn, a drop in global demand.
The current selling price is below the cost of production for Nigerian crude producers which is estimated at $22 and the budgeted crude benchmark of $30 per barrel.
Crude earnings account currently account for 90% of Nigeria’s forex earnings.
“The market is simply responding to the forces of demand and supply precipitated by the COVID-19 pandemic,” the Nigerian National Petroleum Corporation was quoted to have said in a statement.
“We are working assiduously to guarantee a steady market for our crude in the short and long term.”