The price of Brent crude oil broke the $71 per barrel level Thursday for the first time since 2014 after US crude inventories fell for the 10th week in a row and the US dollar weakened.
The US dollar hit its lowest since December 2014 against a basket of other currencies, sliding further as comments by the European Central Bank president boosted the euro a day after US Treasury Secretary, Steven Mnuchin, said a weaker dollar was “good for us,” according to Reuters.
A falling dollar makes dollar-denominated commodities cheaper for other currency holders and tends to support oil prices. Tightening global supplies have also lifted oil, as the Organisation of the Petroleum Exporting Countries and allies, including Russia, have continued supply curbs.
Brent crude has rallied almost 60 per cent since the middle of last year as OPEC and allied producing nations stick to agreed output curbs.
Nigeria, which derives about two thirds of its revenue from crude, is keen to diversify its economy.
The Minister of Finance, Mrs. Kemi Adeosun, has said the country is learning to ignore crude oil prices, according to Punch.
“We’ve got to a point where we don’t care,” whether oil prices will be sustained at the level that they have recently risen to, Adeosun said during an interview with Bloomberg in her office in Abuja.
“We’ve been able to balance our budget at $45-$46 per barrel and we’ve got to learn to live comfortably at that level,” she added.
It will be recalled, Nigeria is recovering from a contraction of its economy in 2016, the first in 25 years, after a decline in oil prices and in the nation’s output due to unrest in the Niger Delta.
The country can’t afford to rely so much on the commodity anymore, Adeosun said.
“Yes, it’s at $66-$67 per barrel today, but we’ve been here before, right? And we can’t afford to be exposed to that, so I really try very hard to ignore the oil price,” she added.