Nigeria’s economic woes deepen as oil price crashes to $29

By Shola Abayomi.

Nigeria’s staggering economy took another hit on Monday night as the international oil benchmark, Brent crude, fell below the $30 per barrel mark.

Brent, which Nigeria produces, plunged more than 10% to settle at $29.84 per barrel as of 7.30pm yesterday, the lowest since the 2016 recession.

The global economic crisis, occasioned by the outbreak of the novel Coronavirus (COVID-19) has threatened the implementation of Nigeria’s 2020 budget, which was benchmarked at $57 per barrel and 2.18 million barrels per day oil output.

The excruciating drop in oil price has hamstrung the Federal Government’s projection of generating N2.64 trillion oil revenue, which amounts to over 30 per cent of the expected total revenue for 2020.

According to the Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC), Mr Mele Kyari, the country was struggling to find buyers for its crude oil, as over 50 cargoes—representing more than 70 per cent of Nigeria’s total oil exports were yet to be sold.

The NNPC boss further disclosed that the unsold cargoes were stranded due to the higher selling price compared with other OPEC members such as Saudi Arabia and Iraq, which offered discounts of around $5—$8 per barrel to buyers.

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