NIGERIA: THE CRUDE OIL ECONOMY

Synterra the Nigeria Risk Management Consultants provide insight into how the oil markets affect the Nigerian economy. Nigeria's reliance on crude oil receipts is total. At a time of increasing volatility and uncertainty this blog seeks to provide an analysis of the effect the global energy markets have on business in Nigeria, their relationship with OPEC and how local policy decision making affects investment opportunities.

NNPC CHOOSE TO PUMP UP THE VOLUME

The boss of Nigeria's national oil company NNPC, Mallam Mele Kyari has confirmed in a statement released on Monday that, Nigeria is now  producing  2.3 million barrels of crude oil daily, including condensates. The end of the OPEC+ deal has seen the start of a free for all as the agreement...
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SHALE FLEES TO THE SANCTUARY OF PROTECTIONISM IN THE AGE OF TRUMP

 "If I have to do tariffs on oil coming from outside or if I have to do something to protect our ... tens of thousands of energy workers and our great companies that produce all these jobs, I'll do whatever I have to do," ...  . Unless US Shale is about...
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NIGERIAN OIL SHUT-IN LIKE END OF DAYS

NIGERIA BRACES AS CRUDE OIL  SHUT-INS LOOM Brent crude the international oil price benchmark and the basis which Nigeria uses for price discovery of its crude grades fell to $22 per barrel on Monday, its lowest level in 18 years . Such a price if it persists for a short while...
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EXCESS CRUDE ACCOUNT A BRAZEN SLUSH FUND

It simply cannot be the case that an  Excess Crude Account  which has swallowed a whooping $107.4 billion  since it was established should be beyond the scrutiny of  the Nigeria people. If the so called Excess Crude Account (ECA) could talk I suspect it would have a harrowing tale to tell....
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BUHARI TIME FOR CBN TO FLOAT THE NAIRA

Nigeria must now prepare to accept the new reality, the time of windfall booms fuelled by surging oil revenues has come to an end. The world is awash with oil at a time the renewable footprint is ever increasing. More importantly what the global oil market is witnessing in a time of demand destruction is an existential struggle for market share. Nigeria is ill equipped to join this battle.  In the 1980s the Nigerian economy first  fell victim to a calamitous economic decline following a windfall boom  brought on  by crashing oil revenues. The same thing happened in 2014 and as a consequence drove the country into recession . It has now happened yet again in 2020. To make things worse it comes at a perilous time with COVID-19 threatening economic and societal Armageddon.

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RUSSIA WAGE WAR ON US TO END SHALE'S FREE RIDE

RUSSIA AND SAUDIS DECLARE WAR ON THE US.   Many of us have been  brought up in the empirical tradition that avers "if it looks like one, walks like one and quacks like one, it is a duck". If I didn't know better,  I would say that the so called Russia-Saudi...
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OPEC CRASHES NIGERIA'S ECONOMY ; TIME TO LEAVE

When it came it was as abrupt as it was devastating, a collapse in crude oil price futures significant enough to be defined as a material adverse change. In other words a calamity, at a time Nigeria is least able to absorb it.  Indeed the Group Managing Director (GMD) of Nigerian...
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SAUDIS MIGHT REGRET STARTING RECKLESS OIL PRICE WAR

When asked about the proposed OPEC production cuts last week, UAE energy minister Suhail al-Mazrouei told reporters in a show of what now turns out to be misplaced confidence,   "I can not see us not agreeing, because that's very important for the market." He however went on to state that in...
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FINALLY TIME FOR OPEC TO DEAL WITH SHALE

TIME FOR OPEC TO TO DEAL WITH US SHALE     This is no time for OPEC+ to cut production and if I were in charge I would maintain production levels as they currently stand. The main beneficiary of any OPEC cut would be shale. According to Moody’s investor service  60%...
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