Nigeria’s oil exports to the United States are set to face a significant setback as former U.S. President Donald Trump, now President-elect, prepares to declare a national energy emergency and issue an executive order aimed at boosting domestic oil and gas production.
This development comes as global oil prices, including Nigeria’s Bonny Light, fell to $80 per barrel from $83, reflecting market uncertainties ahead of Trump’s inauguration and potential policy shifts.
Historically, the U.S. has been a major importer of Nigerian crude oil. However, advancements in shale oil production and deliberate policy decisions have significantly reduced its reliance on foreign oil.
Despite this, the U.S. still imported $4.73 billion worth of Nigerian oil and gas in 2023. Experts warn that Trump’s energy policies could lead to further declines in Nigerian oil exports and revenue in the coming years.
Dr. Muda Yusuf, Chief Executive Officer of the Centre for the Promotion of Private Enterprise, noted that increased U.S. oil production could heighten global supply and push energy prices lower.
“If energy prices fall, it will negatively impact Nigeria’s revenue. However, it could benefit businesses by reducing the cost of petroleum products such as petrol, diesel, and jet fuel,” Yusuf explained.
He also highlighted the potential impact of Trump’s approach to resolving the Russia-Ukraine conflict. “If sanctions on Russia are lifted and oil production increases, global oil prices will drop further, affecting Nigeria’s revenue,” he added.
Energy analyst Dr. Bala Zakka echoed similar concerns, emphasizing the need for Nigeria to expand its refining capacity.
“Reducing dependency on crude oil exports will add value to our economy. Trump’s policies could encourage Nigeria and other African nations to refine more petroleum products locally,” he said.
Meanwhile, the Oil and Gas Service Providers Association of Nigeria (OGSPAN) urged the federal government to diversify the economy and reduce its reliance on oil revenues.
On a positive note, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) assured consumers of steady fuel supply during the festive season.
The association credited the agreement with Dangote Refinery, which processes 650,000 barrels per day, and the soon-to-be-revived NNPC-owned Port Harcourt Refinery for ensuring a steady flow of petrol.
Dr. Joseph Obele, PETROAN’s National Public Relations Officer, expressed optimism, saying, “The collaboration with Dangote Refinery and the strategic planning by our distribution committee will prevent fuel scarcity and allow Nigerians to travel smoothly this season.”
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