Tensions Over Strait of Hormuz Push Bonny Light to $95 a Barrel

Bonny Light, Nigeria's benchmark light sweet crude, traded near $95 a barrel on Friday due to ongoing geopolitical tensions in the Middle East and concerns about the Strait of Hormuz.

The tensions have pushed Brent up by roughly 6.5% during the session, while European gas prices climbed just under 9%. Market participants hope that negotiations between Iran and Oman over transit regulations through the strait could ease pressure if concluded, but larger unresolved security risks mean any relief may be fragile.

Nigerian grades such as Bonny Light, Forcados, and Escravos are priced against dated Brent and fetch premiums for their low sulfur, light profiles. Despite a 2.3-4% decline in Nigerian crude output last month to between 1.505 million and 1.546 million barrels per day, average production remained near Nigeria's OPEC quota floor of 1.5 million bpd.

The market's near-term focus will remain on developments in Iran and the status of the Strait of Hormuz. European gas markets are expected to remain tight even if oil-route tensions abate, with forecasts from major agencies reflecting an uncertain mix of factors.