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Oil price nears $59 on back of U.S stock drawdown

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Nigeria's crude oil export threatened as 30 cargoes remain available

The international oil benchmark, Brent crude, rose further on Thursday, trading near $59 per barrel according to data from Oilprice.com.

As at 11.00am Nigeria time, data showed oil trading at $58.79 per barrel a 0.41 cents increase from Wednesday trading.

Since Tuesday, Oil prices have been boosted by a drawdown in the United States crude and petrol stocks that added to demand recovery hopes fueled by forecast of major producers of a deficit in the market this year, according to Reuters.

It said the market was also bolstered as Democrats in the US Congress took the first steps towards advancing President Joe Biden’s proposed $1.9tn coronavirus aid plan without Republican support.

Read also: Nigeria gets revenue boost on oil price rise, roll-out of Covid-19 vaccines

The API oil industry association reported that US crude oil inventories fell by 4.3 million barrels in the week to January 29.

Prices were also buoyed by the latest assessment by the Organization of the Petroleum Exporting Countries (OPEC) and its allies that the oil market could be in deficit throughout this year.

Nigeria’ budget benchmark for oil price is $40, and the continuous rise in oil price will play a significant role in how the country’s finance will fare this year.

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