Nigeria May Go Bankrupt As Crude Oil Sells @$72 Per Barrel.

Many times I wonder what the leadership of this country is thinking would happen if the price of crude oil continues to fall. The black gold which has been attacked by some parts of the western as a major cause of climatic change, is presently traded @$72 per barrel. The Yaradua administration when drafting the 2010 bugdet kept crude oil benckmark price at $67, only $5 away from the current price.

When will happen if the price touches $67 or sells below that?

Will Nigeria go for loan, to feed over $150 million people and to pay workers' salary?

How can we make this good for nothing leaders know the impending doom that awaits Nigeria, if the price of crude oil continues a downward trend next week?


http://www.opec.org/opec_web/en/data_graphs/40.htm

I think the question should be directed at Paddylo who told us authoritatively that crude oil would never cross $67/barrell. . . 

na wa!!!

Gold-mind:

Many times I wonder what the leadership of this country is thinking would happen if the price of crude oil continues to fall. The black gold which has been attacked by some parts of the western as a major cause of climatic change, is presently traded @$72 per barrel. The Yaradua administration when drafting the 2010 bugdet kept crude oil benckmark price at $67, only $5 away from the current price.

When will happen if the price touches $67 or sells below that?

Will Nigeria go for loan, to feed over $150 million people and to pay workers' salary?

How can we make this good for nothing leaders know the impending doom that awaits Nigeria, if the price of crude oil continues a downward trend next week?

why are you complaining, siddon there.
naija is doing well, in fact we are about to create more states thereby enlarging the bureaucracy and federal expenditure. that's development my friend.

it sold lower than that b4.

[/quote]it sold lower than that b4.[quote]

Yes that was during the melt down, about last 2 years. It even touched $34. I could remember Yaradua was afriad, but it later bounced back to $80. Today, EU is in turmoil but they are not relaxing. They are working hard to make sure it doesn't continue but our own bad days are looming aroung and nobody cares to know.

From my own prediction, once the western world transfers from crude oil to another thing as source of energy, Nigeria will start finding things difficult becos crude oil will become worthless.


It will become "Nigerians in diaspora don't come back home, stay where you are."

@labiyemmy:

it sold lower than that b4.

Yes!you are right but our budget is not as huge as this then.

@labiyemmy:

it sold lower than that b4.

Yes!you are right but our budget is not as huge as this then.

Isn't that the reason we save the excess. We've had an excess of almost $15 the whole year now. If the price goes down just $10 below to $57 and stays so for the rest of the year, we wouldn't have any real problems as the excess would serve as a comfortable buffer.

Asides, the price is definitely going to go back up. The drop in price is most likely because the winter is over. Demand is usually higher during the winter as energy is used to power heaters.

Prices will go up significantly again in mid summer, July & August to be specific as we enter driving season especially in the US where those Gas Guzzlers will hit the freeways burning swaths of gasoline to the benefit of the Nigerian economy.

So no shaking!

Isn't that the reason we save the excess. We've had an excess of almost $15 the whole year now. If the price goes down just $10 below to $57 and stays so for the rest of the year, we wouldn't have any real problems as the excess would serve as a comfortable buffer.

If the price stays low for a sustained period of time, Nigeria will struggle. At the moment, it's a low probability but you can't rule that out. Judging from what happened when prices tumbled in '08, we depleted our foreign reserves from $61bn to $40bn, a low price for a couple of years might wipe out our reserves. If there are sovereign defaults in Europe, you can wave bye to our reserves.

Isn't that the reason we save the excess. We've had an excess of almost $15 the whole year now. If the price goes down just $10 below to $57 and stays so for the rest of the year, we wouldn't have any real problems as the excess would serve as a comfortable buffer.

excess crude oil. ummm. did you see it?

where is it?

I wonder how a nation of 419 can be 419ned by their government.

God in heaven, please, please make oil price keep falling.
Make it fall below $50, below $20, and eventually make it worthless at $0.
When prayerfully we're devoid of oil, there will be a temporary hardship, no doubt, but an opportunity for us to rise from the ashes of crude oil based exporting economy to one that would empasize our people; their talents, skills, and God given ingenuity.

When there is no more oil, Nigeria will resume her national development suspended after we discovered oil in the 1960s, when she was compared with India, Malasyia, Brazil, and even Indonesia. With oil came easy money, laziness, corruption, etc. Some people have said that we discovered oil too early in our national develpment, I don't know, but I do know that for every one reason why oil has been good for us as a nation, I can give 10 more reasons why it's been a curse.

When oil is gone from our national conciousness, then groups and tribes that really and truely want to remain part of this entity called Nigeria will raise their hands in affirmation, those that want to go it alone shall take a peaceful exit. Oil is the covalent bond holding our country together, but no country can really develope if its people are forcefully held together by such artifact as oil.

People will do an honest day's work for an honest day's pay. The surviviors of the post oil Nigeria will look inwards to other abundant God-given agricultural resources of this country, our workful will be pushed and challenged to survive or die, and they will survive just like India, China, and even Japan have all survived, and steaming ahead without any crude oil for export and to lubricate the engine of their corruption.

Post oil bankruptcy is just going to be a small milestone of the temporary hardship that will befall Nigeria when oil is priced down to insgnificant economic level, but it will do us more good than harm on the long run. It will make us come to our senses.

Gold-mind:

Many times I wonder what the leadership of this country is thinking would happen if the price of crude oil continues to fall. The black gold which has been attacked by some parts of the western as a major cause of climatic change, is presently traded @$72 per barrel. The Yaradua administration when drafting the 2010 bugdet kept crude oil benckmark price at $67, only $5 away from the current price.

When will happen if the price touches $67 or sells below that?

Will Nigeria go for loan, to feed over $150 million people and to pay workers' salary?

How can we make this good for nothing leaders know the impending doom that awaits Nigeria, if the price of crude oil continues a downward trend next week?

Why are you criticising? Is it just because you can?

What makes you sure the price will not go up?

Is it not around the figure they pegged it at? You just want to show you too can complain?

If it goes below, the extra revenue generated when it was above for half the year will not reasonably even things out?

Nigeria's annual budget is about $31bn. They have about $40bn in reserve. So they have money to last one year, so why do you think they can go bankrupt when they have money to last till the price goes back up. You just want to show you too can complain?

story story

Nigeria was not auctioned during the melt down

Ibime:

I think the question should be directed at Paddylo who told us authoritatively that crude oil would never cross $67/barrell. . . 

Crude has just dipped below $71.00 as I'm typing this. Where is Paddy Lo?  

When prayerfully we're devoid of oil, there will be a temporary hardship, no doubt, but an opportunity for us to rise from the ashes of crude oil based exporting economy to one that would empasize our people; their talents, skills, and God given ingenuity

where do you live?

HARDSHIP has always being in Naija.

you never hear suffering and smilling?.

In Europe, salaries are being cut, in Nigeria- salaries are going on the increase-

I know the reaction this statement will generate.

This is NYMEX we are talking of, I don't know how much Bonny Light Crude(or whatever oil we sell) is selling for. Brent closed today at 77.9 http://www.shareprice.co.uk/ID:16102115/BRENT-OIL. They are all falling though and will likely go below $60.00 this year. Whether it will stay there for long, I can't tell.

4 Play:

This is NYMEX we are talking of, I don't know how much Bonny Light Crude(or whatever oil we sell) is selling for. Brent closed today at 77.9 http://www.shareprice.co.uk/ID:16102115/BRENT-OIL. They are all falling though and will likely go below $60.00 this year. Whether it will stay there for long, I can't tell.

crude price to go below 60 this year? how? and what would cause that?

tkb417:

crude price to go below 60 this year? how? and what would cause that?

Currently, there is an inverse relationship between the dollar/gold and risk assets(commodities and Western stocks). Any time there is a whiff of bad news, there is a 'flight to safety' as people dump the latter for the former. What is driving it at present is fears about Europe's economic prospects. To the extent that those fears about Europe, IMHO, will continue to grow, I can easily see crude going below $60. Also, China is tightening monetary policy and that is driving prices lower. -$60.00 beckons but I can't say it will stay that way for long.

4 Play:

Currently, there is an inverse relationship between the dollar/gold and risk assets(commodities and Western stocks). Any time there is a whiff of bad news, there is a 'flight to safety' as people dump the latter for the former. What is driving it at present is fears about Europe's economic prospects. To the extent that those fears about Europe, IMHO, will continue to grow, I can easily see crude going below $60. Also, China is tightening monetary policy and that is driving prices lower. -$60.00 beckons but I can't say it will stay that way for long.

all you indicated are not enuff to drive oil prices below 60

for crude prices to hit 50ish, then somethn drastic would have happened a la what we experienced during the melt down.
This is just a 'temporary glitch' and is not uncommon in the global oil trade space

tkb417:

all you indicated are not enuff to drive oil prices below 60

for crude prices to hit 50ish, then somethn drastic would have happened a la what we experienced during the melt down.
This is just a 'temporary glitch' and is not uncommon in the global oil trade space

The sovereign debt crisis in Euroland, a $6 trillion economy, coupled monetary tightening in China can't pull oil prices 15% lower? You are just engaging in wishful thinking, there is nothing 'temporary' about this debt crisis.

4 Play:

The sovereign debt crisis in Euroland, a $6 trillion economy, coupled monetary tightening in China can't pull oil prices 15% lower? You are just engaging in wishful thinking, there is nothing 'temporary' about this debt crisis.

lets do the maths

i give you 15%

take off 15% from 71, what do you have?

71-10.65= 60.35

tkb417:

lets do the maths

i give you 15%

take off 15% from 71, what do you have?

71-10.65= 60.35

Today's low is $70, which planet do you live on? 15% off that low, it will go lower in coming weeks, and we will hit sub $60, easy peasy.

4 Play:

Today's low is $70, which planet do you live on? 15% off that low, it will go lower in coming weeks, and we will hit sub $60, easy peasy.

haha

i dont see anythin empirical in ur 15% assumption

show me the charts, with the doji flagging the danger sign and maybe i can believe

as it is, the debt crisis isnt enuff to bring down the prices by 15% .

we all will be here to discuss later

tkb417:

haha

i dont see anythin empirical in your 15% assumption

show me the charts, with the doji flagging the danger sign and maybe i can believe as it is, the debt crisis isnt enuff to bring down the prices by 15% .

we all will be here to discuss later

Fundamentals, not TA, is what is driving prices. Oil is priced in dollars and if the dollar keeps going up, oil will keep going down.

I don't trade oil but many indications suggest that risk assets, equities and commodities, will go lower.

4 Play:

Fundamentals, not TA, is what is driving prices. Oil is priced in dollars and if the dollar keeps going up, oil will keep going down.

I don't trade oil but many indications suggest that risk assets, equities and commodities, will go lower.

i know all that 4play

nyways, ill hit you up when ur analysis go wrong

so lets wait

tkb417:

i know all that 4play

nyways, ill hit you up when your analysis go wrong

so lets wait

The recent low, Jan '09, was $33.20 and the recent high was $87.15. I think that recent high is key, if we retrace 61.8% of that, that will see us at $53.80.

$60 is good support but the debt panic can easily take us below that. Did you see how Europe's equities sold off today? I'm not sure of a sub $60, but the fear levels are approaching the post-Lehman days.

[/quote]Fundamentals, not TA, is what is driving prices. Oil is priced in dollars and if the dollar keeps going up, oil will keep going down.

I don't trade oil but many indications suggest that risk assets, equities and commodities, will go lower. [quote]

I don't trade cude oil as well. But monthly, weekly and daily chart are all on strong down trend. That's why EU and UK is stategizing, shifting their attention from crude oil to make sure this rubbish doesn't go far, but Nigerian leaders are failing to read the handwriting on the wall.

Gold-mind:


I don't trade cude oil as well. But monthly, weekly and daily chart are all on strong down trend. That's why EU and UK is stategizing, shifting their attention from crude oil to make sure this rubbish doesn't go far, but Nigerian leaders are failing to read the handwriting on the wall.

The flip side is that the tempering of the Niger-Delta crises has meant that crude oil production has risen fairly substantially.

We're well off today's lows . . . currently pushing towards $72.00. With all the panic over Europe, -$60 within the coming months beckons still.

For Nigeria, we need to work harder towards diversifying our economy. Dependence on one commodity is just wreaking havoc on the country.

OPEC dictates prices,

OPEC dictates production quota's,

Nigeria has little or no say in the matter.

No doubt Nigeria need to develop other economic potentials, as for oil pricing and profit, Nigeria would still be producing at gains even if oil sells for less than $20 the NorthSea and the US producers would shut down if the price goes below $35.
We could increase our OPEC production quota if we make more discoveries since the quotas is directly proportional to proven reserves. We could also further develop gas production, it is not guided by quota and sold before production, so price fluctuation is minimal.