Brent crude tumbled more than 5% to $83.44 per barrel on Monday, August 3, after President Donald Trump called off a fresh attack on Iran and signalled he was pursuing a quick deal to halt Tehran's nuclear ambitions and reopen the Strait of Hormuz, triggering the sharpest oil price decline in weeks and reviving the possibility of further petrol price relief in Nigeria.
Brent futures slid $4.49, or 5.11%, to $83.44 by early Asian trading on Monday while WTI crude fell $4.90, or 5.79%, to $79.77, reversing a significant portion of gains accumulated last month as Houthi strikes on Saudi tankers and the collapse of the first ceasefire sent both benchmarks sharply higher. Both contracts had surged more than 20% in July alone at the peak of the crisis, with Brent briefly crossing $100 per barrel after Houthi forces targeted shipping in the Bab el-Mandeb Strait.
Trump announced late Saturday on his Truth Social platform that Iran and other Middle Eastern countries had asked for time to complete a deal, a signal markets read as a genuine de-escalation rather than the tactical pauses that had been declared and then reversed multiple times since late July. The framing differs meaningfully from previous ceasefires: Trump explicitly described a nuclear dimension to the negotiations, suggesting a broader diplomatic architecture than the earlier, narrower shipping-access arrangements that proved short-lived.
OPEC+ separately approved a modest production quota increase of approximately 188,000 barrels per day from September, completing the rollback of its voluntary output cuts amid persistent export disruptions. The combination of diplomatic progress and additional supply entering the market reinforced Monday's selloff, pulling crude away from the geopolitical peaks that had briefly made ₦800 per litre Nigerian petrol look like a distant memory.
For Nigeria's downstream market, the trajectory of Brent now carries direct consequences. Dangote Refinery raised its naira-denominated ex-depot gantry price to ₦1,215 per litre on July 22 as crude surged following Trump's first ceasefire reversal, reversing four successive price cuts that had been implemented when Brent retreated from its March peak. If Brent stabilises in the low-to-mid $80s and the nuclear negotiations advance without another collapse, the refinery has the precedent and the pricing mechanism to begin reversing those increases again, as it demonstrated during June's four-round reduction cycle.
The critical variable is whether the diplomatic signal holds. The previous pattern, established clearly through five months of on-off conflict, is that Trump announces de-escalation, oil falls, markets price in normalisation, and then a fresh provocation sends everything sharply higher again.
Both Brent and WTI jumped more than 20% last month after fighting resumed, and attacks on tankers around Oman deterred shippers from entering the Gulf, a reminder of how quickly the current easing could reverse. The Strait of Hormuz has not reopened. The nuclear deal has not been signed. And Iran's response to Trump's latest overture has not yet determined whether this pause is the beginning of a resolution or simply the latest chapter in a conflict that has repriced every barrel of Nigerian crude, every litre of petrol and every line of the federal budget five times over in six months.
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