Nigeria may lose out on Gulf of Guinea oil boom

January 29th, 2007


President George Bush’s announcement in his state of the nation address last week that the United States of America (USA) would reduce its oil imports by 75 percent was bad news to oil exporting nations generally, but not all of them would be equally affected.


Worst hit would be the nations in the Persian Gulf from which the US currently imports the bulk of its oil, but which it plans to drastically scale down on the wings of growing anti-Americanism in the Arab world. On the other hand, oil exporters in west Africa’s Gulf of Guinea to which the US is shifting its oil import attention, is likely to remain unscathed, and indeed is likely to enjoy a boom in US imports.

Last year, in another state of the nation address, President George Bush had proposed steps to "make our dependence on Middle Eastern oil a thing of the past".

Unfortunately, Nigeria, the principal oil exporter in the Gulf of Guinea may miss out on this boom, unless a quick solution is found for the Niger Delta crisis. The US has so far ruled out direct intervention in the crisis, and can source significant portions of its supply from the offshore fields of Equatorial Guinea and Sao Tome and Principe, both within the Gulf of Guinea. Added to safe oil from Nigeria’s deep offshore fields and Joint Development Zone (JDZ) owned by Nigeria and Sao Tome and Principe, the US have its full supply and would have little incentive to meddle in the shut-ins and hostage taking that has characterized Niger Delta oil prospecting and drilling in recent years. Moreover, Angola bathes in mega new oil discoveries in recent years and it is very likely that this Southern African country will overtake Nigeria as Africa´s largest oil producer in the next three to four years. Angola is politically stable and only has 11 million people as opposed to Nigeria´s 140 million people.

Analysing the shift already made in this direction, Brett D. Schaefer, a research fellow in regulatory affairs at the Heritage Foundation, Washington, declared on March 7, last year that "Africa is increasingly important to the United States as a source of oil". The country’s oil imports from sub-Saharan Africa has leapt by about 33 percent since 1999, while imports from the Middle East has decreased. In 2005, Schaefer said, sub-Saharan Africa supplied 18 percent of US oil imports. West Africa’s Gulf of Guinea accounts for 78 percent of this, with Nigeria being the overwhelming source. West Africa is projected to account for 25 percent of total US oil imports within this decade. Currently some 25 percent of Nigeria’s oil output is exported to the US.

Nigeria exported over 4.2 billion barrels of crude oil and petroleum to the US from 1993 to 2006.

To reach this goal of import cut, Bush indicated that "US must increase the supply of alternative fuels, by setting a mandatory fuels standard to require 35 billion gallons of renewable and alternative fuels in 2017. This is nearly five times the current target".

The reason for Federal Government to pay special attention to oil revenue, analysts indicate, is that oil prices are volatile and cannot be at its current rate in future.

Oil accounts for more than 90 percent of Nigeria’s export, 25 percent of its Gross Domestic Product (GDP) and 80 percent of its public revenues. Thus, a drop in oil price can have negative impact and vice versa.

A $1 increase in the oil price in the early 1990s increased Nigeria’s foreign exchange earnings by about $650-million (two percent of GDP) and its public revenue by $320-million a year.


PS: WE HAVE TO SECURE OUR COUNTRY AND MAKE IT A STABLE PLACE OR WE WILL MISS OUT THE NEW IMPENDING MEGA OIL BOOM OF THE GULF OF GUINEA. What is wrong with our politicians? Are they all mad or what?

its PROPAGANDA


Its all a bluff, USA CANNOT CUT OIL IMPORTATION BY 75%.

THE OIL BLOCKS IN US ARE VIRTUALLY DRY AND USA HAVEN'T GOT THE OIL RESERVE TO SUSTAIN THE ECONOMY FOR A LONG PERIOD OF TIME.



_{USA SHOULDN'T DICTATE, ITS LIKE SOMALIA DICTATING FOOD IMPORT BACK IN THE FAMINE DAYS. USA IS HOOKED ON OIL.}

stranger12:
its PROPAGANDA


Its all a bluff, USA CANNOT CUT OIL IMPORTATION BY 75%.

THE OIL BLOCKS IN US ARE VIRTUALLY DRY AND USA HAVEN'T GOT THE OIL RESERVE TO SUSTAIN THE ECONOMY FOR A LONG PERIOD OF TIME.



_{USA SHOULDN'T DICTATE, ITS LIKE SOMALIA DICTATING FOOD IMPORT BACK IN THE FAMINE DAYS. USA IS HOOKED ON OIL.}

This it's true, since they abandoned the gold standar they have petrol determine the value of their currency, or the petro-dollar as it's usually called, that way they need a constant oil consumption and any state that attempts to follow them needs to do the same, that way China and Germany gets dragged into oil regulated by the american military, cause they can't get oil from russia or Saudi Arabia derectly, because they don't allow a pipeline to be built.