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Improving Nigerian oil fortunes is crucial to rebound

Monday, June 10, 2019

Subject

Nigeria oil outlook..

Significance

Growth in the first quarter of 2019 slowed to 2.1% of GDP, down from 2.38% in the fourth quarter of 2018, according to data released by the National Bureau of Statistics (NBS) last month. This slowdown was in large part due to contraction in the oil sector of 2.4%, even though production was higher than the preceding quarter. As the federal government struggles to overcome its fiscal crisis, the oil sector’s fortunes are crucial to short-to-medium term recovery.

Impacts

  • As its revenue challenges mount, the presidency will likely grow increasingly interventionist in the oil sector, deterring investors.
  • Presidency plans to restart contested production in Ogoniland presents long-term risks amid local tensions and environmentalist opposition.
  • While oil theft is receiving more attention, attempts to curb it may affect fragile Niger Delta peace dynamics.

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