By Adedapo Adesanya

Oil prices took a worse turn on Friday evening after Russia rejected the proposal to cut daily oil production by 1.5 million barrels. This development further dented the already battered market.

After the meeting, Russia refused to support the move, arguing that it was too early to predict the impact of a coronavirus outbreak on global energy demand. This means bigger trouble for oil dependent nations like Nigeria as prices continue to fall below their budget benchmark for the year. Nigeria had a benchmark of $57 per barrel in the 2020 budget.

Business Post reports that as at the time of filing this report (6:45pm), the international benchmark, Brent Crude, plunged by 8.20 percent equivalent to $4.09 to trade at $45.90, while the US crude, the West Texas Intermediate fell by a staggering 8.45 percent or $3.88 to $42.02 per barrel.

With the failure of this deal, OPEC members and non-OPEC producers can produce the commodity at will in an already oversupplied market after the existing deal for output cuts expire at the end of March.

And with an oil-glut imminent, prices will have no choice but to continue dropping.

On Thursday, OPEC members backed an additional 1.5 million barrels per day of oil cuts until the end of 2020, equal to around 1.5 percent of global demand, a much bigger and more extended move than expected of 600,000 barrels per day.

They also called for extending existing OPEC+ cuts of 2.1 million barrels per day, meaning the proposed combined total of the cuts envisaged would have been 3.6 million bpd or about 3.6 percent of global supplies.

But they made the proposal on the condition that Russia and other non-producers will agree to the deal, but with the disagreement, analysts foresee a bad stain on a market already faced with the disruption by the coronavirus.

https://businesspost.ng/economy/breaking-brent-hits-45-as-opec-russia-disagree/

Ok

Nigeria Myopic leaders, how market? I have never seen a country so blessed but so poor.

Greatm... oil is bad for our environment I wish the oil market will collapse

And we want to borrow $20 billion?

Sigh, Nigeria has really wasted DECADES worth of oil earnings.

Just imagine how much we have earned, how much has been stolen, how much more we would have earned without subsidies...

Nothing to show for it

Thanks to the undoubted increase in Agricultural exports from Nigeria hopefully when push comes to shove people will clean their eyes and see that this present administration is not as clueless and hopeless as they presume.
What if we didn't diversify? Now agriculture is on its way to become a major source of revenue and you want to say buhari is not doing anything?

Oil productions are not affected but the virus oil consumptions ( buyers)

IATA are projecting $100+ due to Coronavirus

It's well

It is high time Nigeria got off oil

We should start by ending subsidies on power and fuel, directing funding towards improving power supply, and transport, meanwhile focusing on attracting as much investment as possible.

helinues:
Oil productions are not affected but the virus oil consumptions ( buyers)

IATA are projecting $100+ due to Coronavirus

100$+ due to CoronaVirus...How ?

Aidejay:
Thanks to the undoubted increase in Agricultural exports from Nigeria hopefully when push comes to shove people will clean their eyes and see that this present administration is not as clueless and hopeless as they presume.
What if we didn't diversify? Now agriculture is on its way to become a major source of revenue and you want to say buhari is not doing anything?

In what alternate universe ?

Who told you that there is a significant increase in agric exports ?

Kindly post export figure and the Agric products being exported, and to which countries.

The only Agric products being exported in significant quantities are basic Nigerian food products being exported to Nigerians in the Diaspora, by the same Nigerians in the Diaspora.
I'm quite sure it runs into millions of Dollars per annum, but one can hardly say there has been a very significant increase over the last few years. Funny enough, the increased export of basic Nigerian food products abroad corrollates strongly with the increased exodus of the Nigerian middle class and economic refugees from the desolate land that Buhari has turned Nigeria into.

the Zoo must end

[s]

Afamed:
It's well

[/s]

Unfortunately for you half baked BMO,
There are educated people on this forum,
Buhari is trying to achieve what GEJ did without closing borders

"Specifically, in 2014, Nigeria’s export was valued at ₦16 trillion. This represents a 17% increase year on year. Exports, however, dropped drastically in 2015 to ₦9.6 trillion and ₦8.5 trillion in 2016 respectively. In 2017 and 2018, they rebounded.

In 2018, the report shows that the value of total exports in Q4, 2018 increased by 3.52% against the level recorded in Q3, 2018 and 28.46% higher than its value in Q4, 2017.

Imports also grew significantly to ₦13 trillion in 2018. Comparing the 2018 export value to the ₦9 trillion in 2017, it represents a 38% growth in imports for the period under review.

Aidejay:
Thanks to the undoubted increase in Agricultural exports from Nigeria hopefully when push comes to shove people will clean their eyes and see that this present administration is not as clueless and hopeless as they presume.
What if we didn't diversify? Now agriculture is on its way to become a major source of revenue and you want to say buhari is not doing anything?

Aidejay:
Thanks to the undoubted increase in Agricultural exports from Nigeria hopefully when push comes to shove people will clean their eyes and see that this present administration is not as clueless and hopeless as they presume.
What if we didn't diversify? Now agriculture is on its way to become a major source of revenue and you want to say buhari is not doing anything?

What's this one blabbing about?

What agricultural produce are you exporting that can service the abominable debt this government has thrown the country into?

The same oil is what they continue to search for in the north spending millions of dollars.

It’s about to get messy!!

Diversification is the solution

as usual market trend always react to negative events in a bearish manner

lets look at it this way, crude demand drops because flight rate to China (world most populous country) Saudi (world top pilgrimage destination), Italy/Vatican City (worlds top tourism and pilgrimage site) Egypt (top torism destination) has significantly dropped, few people fly into China, Saudi, Italy, Egypt etc this simply means litters of Jet A fuel gotten from crude oil and lubricants used by Jets is drastically reducing forcing a price drop due to low demand

.

Gandollaar:
What's this one blabbing about?

What agricultural produce are you exporting that can service the abominable debt this government has thrown the country into?

The same oil is what they continue to search for in the north spending millions of dollars.

look corona virus would affect all commodity trade just as it affected oil so don't blab about about Nigeria taking loan loan isn't bad, its a long term 30 years single digit loan, and for a fact the moratorium on the loan is as high as 5 years meaning we aint paying a dime until the rail projects get operational and start making its own revenue

This is not good for oil-dependent economy like ours hence the urgency to truly diversify to more non-oil sector economy is imperative.

Kkk

AlfaSeltzer:
the Zoo must end

Bros you are really angry with the zoo ooo!

solmusdesigns:


look corona virus would affect all commodity trade just as it affected oil so don't blab about about Nigeria taking loan loan isn't bad, its a long term 30 years single digit loan, and for a fact the moratorium on the loan is as high as 5 years meaning we aint paying a dime until the rail projects get operational and start making its own revenue

Is it only rail projects you have obtained loan for? Which infrastructure in Nigeria is able to repay it's loan if not not for oil? Loans that they borrow more loans to service is that what you call good economics?

Tomorrow,we will read here how they have to pay one partnering organization millions of dollars for breach in agreement.

Mind you this is a government that claimed they shared Abacha loot to Nigerians while they turn around to borrow to fund projects.

Racoon:
This is not good for oil-dependent economy like ours hence the urgency to truly diversify to more non-oil sector economy is imperative.

Until oil is flowing from all the rocks in North, fulani owned Nigeria can never fully diversify to any non-oil economy that can truly stand to be counted.

StaffofOrayan:
Unfortunately for you half baked BMO,
There are educated people on this forum,
Buhari is trying to achieve what GEJ did without closing borders

"Specifically, in 2014, Nigeria’s export was valued at ₦16 trillion. This represents a 17% increase year on year. Exports, however, dropped drastically in 2015 to ₦9.6 trillion and ₦8.5 trillion in 2016 respectively. In 2017 and 2018, they rebounded.

In 2018, the report shows that the value of total exports in Q4, 2018 increased by 3.52% against the level recorded in Q3, 2018 and 28.46% higher than its value in Q4, 2017.

Imports also grew significantly to ₦13 trillion in 2018. Comparing the 2018 export value to the ₦9 trillion in 2017, it represents a 38% growth in imports for the period under review.

The high exports under GEJ were due to high oil prices,

Oil was above 100 dollars at the start of 2014 and it went down to 75 dollars at 2015 May.

I am no BMO, especially as I think Buhari has kept Nigeria dependent on oil. But the reason why times were good under GEJ for some was the high revenue we earned from oil and the fact that we spent most of it.

Buhari keeps the border closed because he does not want to take the decision to remove subsides on fuel in part. We sell fuel at 145 naira. Our neighbours sell it above 300 naira,and we expect people not to smuggle?

Nigeria has a problem, and it is the idea that selling raw material and importing stuff with the revenue is the way to develop. That is what we have been practicing since independence, and since we do not control the price of what we sell, when the prices go down below the price that would sustain us, we end up borrowing.

Oil is below 50 dollars now. We need it at 140 dollars. We also run too many subsides and welfare programs and APC is also in the looting game. So, loans come in.

Meanwhile, no plan for the oil free future from this government