₦airaland Forum

Freshtruth:
Wike is a goner fubara holds the cards even tuntubi will be loyal to him now at this moment



Tinubu to wike bro my Ambition comes it's no use ur 2nd term quarell come spoil my own leave Fubara alone after raw I gave u Abuja

Geopolitical developments in Venezuela and the prospect of a major rattle in global oil supply dynamics could exert downward pressure on crude prices and ultimately stress-test the Federal Government’s N58.18 trillion 2026 spending plan.

The crisis, which has triggered a review of projections across key markets and put enormous pressure on the crude market, is subjecting key budget assumptions to scrutiny, with President Donald Trump’s targeted $50 per barrel price no longer an illusion.

The country is expected to raise about $40.6 billion by producing 673 million barrels of crude in 2026 or 1.84 million barrels per day and sell for $64.85 per barrel, though the National Assembly has proposed a reduction of the price benchmark to $60 per barrel.

Some analysts project that oil prices may dip to $50 per barrel, thereby leading to a potential loss of about $10.24 billion. Following the invasion of Venezuela by the U.S. and the capture of Nicolás Maduro, President Trump had said his administration would invest in producing oil from the North American country.

Already, eight major producers, including Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria and Oman, yesterday reaffirmed commitment to Organisation of Petroleum Exporting Countries (OPEC)-backed market stability, citing a steady global economic outlook.

With the Federal Government projecting oil revenues as a key pillar of its N58.18 trillion spending plan, stakeholders warn that a faster-than-expected return of Venezuelan oil to global markets could undermine fiscal projections, weaken foreign exchange (FX) inflows and deepen existing revenue challenges.

The concern comes at a time when Nigeria is already grappling with fiscal fragility. The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, earlier disclosed that the Federal Government recorded a revenue shortfall of about N30 trillion in 2025, highlighting the gap between budget expectations and actual inflows.

Naira, which gained N100/$ last year, the strongest in recent years, may face downward pressure in the face of weakened oil market performance.

The 2026 budget framework estimates a total expenditure of N58.18 trillion. This includes N15.52 trillion debt servicing, N15.25 trillion for non-debt recurrent expenditure and N26.08 trillion earmarked for capital spending.

The projected fiscal deficit stands at N23.85 trillion, equivalent to 4.28 per cent of GDP. Oil remains central to the revenue strategy as the government projects crude oil production of 1.84 million barrels per day (bpd) this year, translating to about 672 million barrels for the year.

The budget benchmark price is set at $64.85 per barrel, implying potential gross oil receipts of about $43.84 billion before production costs, joint venture obligations and revenue-sharing arrangements.

Nigeria has consistently struggled to meet its production targets in recent years due to under-investment, oil theft, pipeline vandalism, operational inefficiencies and declining output from mature fields.

Actual production has remained below benchmark levels, raising doubts about the realism of the 2026 assumptions even before factoring in exogenous risks.

If oil prices fall to $50 per barrel, projected gross revenue would drop to about $33.6 billion, creating a substantial gap in funding for the budget and intensifying borrowing pressures.

The capture of President Nicolás Maduro following a U.S.-backed military operation, stakeholders said, would mark a significant political shift.

While such a development may not immediately transform Venezuela’s production capacity, it could alter the country’s sanction status and compliance risk profile, which have been the primary constraints on its oil exports over the past decade.

Export data by the Kpler Risk and Compliance, visualised by MarineTraffic, shows that Venezuela exported around 707 million barrels of crude per year before 2019. During that period, the U.S. accounted for about 32 per cent of Venezuelan exports, making it the country’s largest buyer, while China and India absorbed much of the remainder.

These exports were supported by conventional trading, shipping and insurance arrangements. This structure changed sharply after U.S. sanctions were tightened in 2019. Venezuelan crude exports fell to below 200 million barrels per year between 2020 and 2021. The decline was driven less by a lack of oil reserves or production capacity than by the withdrawal of traders, shipowners, insurers and banks seeking to avoid sanctions exposure.

From 2022, exports began a partial recovery, rising to approximately 250 to 350 million barrels per year by 2023 and 2024. The recovery was largely driven by shipments to China and, to a lesser extent, India and relied on opaque trading practices such as ship-to-ship transfers, blending operations and the use of shadow tanker fleets. Despite the rebound, export volumes remained less than half of pre-2019 levels.

By 2025, Venezuelan exports appeared to be stabilising but remained structurally constrained by legal, governance and compliance risks. Western buyers and service providers have not returned in significant numbers, reflecting continued uncertainty.

Trump has said that US oil companies would spend billions of dollars to rebuild Venezuela’s oil infrastructure following the reported military operation.

He outlined a plan under which U.S. financial resources and technical expertise would be used to repair damaged facilities, with companies reimbursed for their investments.

While the plan faces uncertainties, including the willingness of major oil companies to invest in a high-risk environment, low global oil prices and the scale of reforms required, stakeholders said the direction of the U.S. policy is significant as a gradual easing of sanctions and improved legal certainty could allow Venezuelan oil to re-enter mainstream global markets over time.

For oil-producing countries such as Nigeria, the concern is not necessarily an immediate displacement of exports, but the broader effect on global supply and prices as additional barrels entering the market would increase supply in an already-fragile demand environment, particularly if global economic growth remains subdued.

Some analysts are already projecting oil prices to hover around $50 per barrel in 2026. A faster recovery in Venezuelan exports could reinforce this trend.

Nigeria is already actively seeking buyers for its 2026 crude cargoes. The U.S., India and China remain important customers and a key influence on global oil pricing.

If U.S. demand shifts towards Venezuelan crude, Nigeria could face stiffer competition in selling its medium and light sweet grades. A former chairman of the Chartered Institute of Bankers of Nigeria (CIBN), Prof. Segun Ajibola, said increased U.S. involvement in Venezuela’s oil sector could affect Nigeria’s ability to meet its 2026 projections. As one of Nigeria’s top oil buyers, any reduction in U.S. demand could have knock-on effects for export volumes and prices, he noted.

“At the current price of about $60.8 per barrel compared with Tinubu’s proposed $64.85, the situation is already becoming stressed. If a price war ensues, as could be triggered by increased supply from Venezuela, it will affect Nigeria’s projections for 2026,” he said.

Ajibola said it is increasingly uneconomic for Nigeria to export crude only to import refined products. He urged the government to resolve longstanding issues around moribund refineries, support private refining capacity and divert more crude to domestic processing for local use and export of refined products.

Oil price weakness would also affect Nigeria’s foreign exchange position. Crude oil sales remain the main source of FX inflows. Lower oil receipts would reduce dollar supply, putting renewed pressure on the naira and complicating efforts to stabilise the foreign exchange market.

This risk is particularly acute given the political calendar. With general elections scheduled for 2027, stakeholders expect increased fiscal pressures and higher demand for foreign exchange as political activities intensify.

Beyond price effects, Venezuela’s rehabilitation could intensify competition for global investment capital as Petroleum Economics, Management and Policy expert, Dr Kaase Gbakon, said a derisked Venezuelan operating environment could divert capital away from Nigeria and other African producers.

“Assuming the U.S.-backed action sufficiently reduces above-ground risks, investment will begin to flow to Venezuela. This could slow Nigeria’s oil and gas development, especially at a time when the country needs fresh capital to arrest production decline,” Gbakon noted.

A renowned petroleum economist, Prof. Wunmi Iledare, said Venezuela’s return would add barrels to a market already struggling to balance supply and demand.

“The immediate implication for Nigeria is not loss of market share, but greater downside risk to oil prices. Venezuelan crude will compete directly with Nigeria’s medium-heavy blends,” he said.

He described the $64.85 per barrel benchmark as achievable but noted that the 1.84 mbpd production target remains aspirational given persistent structural constraints.

Iledare said: “The real risk is budgeting on best-case oil outcomes in a global market where prices are increasingly managed. Prudence demands more conservative assumptions and stronger non-oil revenues.”

An economist at the University of Nigeria, Prof. Emmanuel Nwosu, also urged caution, noting that oil price volatility remains a structural risk for oil-dependent budgets.

While lower oil prices can benefit consumers through reduced fuel and transportation costs, he said, they pose fiscal challenges for producing countries that anchor budgets on oil benchmarks.

He added that while OPEC interventions could stabilise prices, evolving geopolitical alignments, particularly between the U.S. and Saudi Arabia, should be closely monitored.

While Nigeria began implementing its tax reform programme in January 2026, aimed at improving revenue mobilisation and reducing dependence on oil, experts are uncertain whether the reforms can deliver meaningful buffers in the short term.

Structural tax reforms typically take time to yield results, and enforcement challenges persist. With debt servicing already consuming N15.52 trillion over a quarter of total expenditure, the scope for absorbing revenue shocks remains limited.

A certified financial education instructor, Kalu Aja, said the oil price benchmark in the 2026 budget now appears generous. “If a new U.S.-backed Venezuelan leadership decides to pump more oil, global prices will come under pressure. If Russia also reaches a ceasefire in Ukraine, prices could fall further. Nigeria should be preparing an austerity budget, not an optimistic one,” he tweeted over the weekend.

Partner at Kreston Pedabo, Olufemi Idowu, said the new U.S.–Venezuela relationship may affect Nigeria’s revenue projections by putting pressure on both oil prices and Nigeria’s ability to sell its crude. According to him, Venezuela and Nigeria both sell crude oil to similar markets, which makes them competitors.

“While the United States is not Nigeria’s largest buyer today, it remains an important market and plays a major role in influencing global oil prices. If the U.S. strengthens its oil ties with Venezuela and supports increased production there, global supply will likely rise. In most cases, higher supply leads to lower prices, and this could reduce Nigeria’s oil revenue,” Idowu said.

With revenues already underperforming and debt obligations rising, the stakeholders insisted that Nigeria has limited room to absorb further shocks, warning that without more conservative budgeting, stronger non-oil revenue mobilisation and tighter spending discipline, the N58.18 trillion 2026 budget could face significant implementation challenges.

Amumaigwe:
How can Wike sign an agreement on a transaction that does not belong exclusively to him? Make it make sense please

LibertyRep:
Didn't the President call a gov 'Eleyi' back then?

Zocalite:
Lolzzzzz 🤣

You don't know the position of US in the world.

Do you know what super power meant

ote author=BondRiv post=138015709]

Stop trying to muddle the waters and be coherent. People act like you do when they know their position is wrong or don't understand what they are talking about. Is the action by the USA government right or wrong?

I don't support Nigeria blindly. Nigeria is not perfect and can make wrong decisions. I'll be the first to admit that.

However, our intervention in Benin was done with the approval of the president of Benin. We did not violate their sovereignty. We didn't interfere in Niger and Mali, but any such intervention would have been done in line with international law. We won't act unilaterally.

The highlighted portion of your comment is a mere allegation from an oil hungry government led by Trump. It remains an unproven allegation. Whether true or not, it cannot justify an attack on Venezuela, killing of armed personnel, civilians, kidnap of the president and his wife.

Now Trump and his gang of thieves want to control the country. Would they have done this if Venezuela was not a weak country? I'm sure they wouldn't have resorted to self-help, but explore other avenues, possibly under international law.

horlando30:
I wonder what Tulsi Garba thinks now?

bigpicture001:
Now senator Omar from Somali decent is in the US Senate and still abusing their nationality...

Us dey take rubbish sha.. try china or isreal for a size

Sheuns:
There’s no better ally for a country than USA. They will have your back always. Take Israel and Saudi Arabia for example. If not for the USA, Iran for don show Saudi shege for Middle East.

Russia and China are unreliable allies.

madridguy:
I am waiting to know what really happened in Venezuela. We need to know what really happened because kidnapping a whole president with no single form of resistance.

Zocalite:
You be comedian

Even nigeria interfered in Benin republic and wanted to interfere in Niger republic and Mali

Moreover US - the world superpower

And Venezuela was also shipping drugs into US using government facilities



Do you know how many Venezuelans were lurking at the border of US daily leaving their country because of maduro

Oga you be comic

Zocalite:
It's funny kamala says it's about oil, and also acknowledge maduro is brutal and illegitimate



Oil in 2026 - lolzzzzz 🤣

How can USA be after oil in 2026

There are many countries discovering oil who are even ready to dash US oil

Many arab countries are lobbying US not to accept green energy

Venezuelans are relieved, and happy a tyrant has been uprooted


Democrats should not have this kind of person as their front man

HacheNoire:
Some Nigerians know more than Kamala

They have been ranting it’s not about oil even when Trump has publicly thrown it to their face.

It’s just really a sad time in history! We have learned, learnt and re-learnt, but glaring the majority of Africans will never escape from mental slavery.

They are clapping for same stroke that was used on them. 🤣😂🤣😂

Cromagnon:
must you hold usd?

SlavaUkraini:
Continue to Cry 😭😭😭😭😭😭😭

Your Hot Tears is very Sweet....

The Venezuelan people will run their own country with the US supporting them...

Let me give you a little bit of History and Geopolitical lesson and make sure you never forget it because it will help you understand some of America's Interventionist actions globally.

Many years ago the American government sent high level diplomats to Saudi Arabia and they made a deal with the house of Saud....

The deal was simple ....

" The House of Saud can continue to Rule the Kingdom of Saudi Arabia with American Protection, while in return, Every Crude Oil must be Sold in Dollars"

The Billions of Dollars in crude sales belong to Saudi Arabia not America but the Crude must be sold in Dollars....

Saddam Hussein had problems with the US when he had plans to start selling Iraqi Crude in Euros....

Ghaddafi started having problems with the US and France when he was proposing a common African currency backed by Gold and Natural Resources...

What Trump and the US is looking for in Venezuela is not Crude Oil because America have enough Crude Oil...

What America is after is the Continuation and Dominance of the Petro-Dollar system

The Global demand for the Dollar must continue. That is what makes America Great

If the New Leader of Venezuela will not Agree to sell Venezuelan Oil in US Dollars that leader will Join Maduro wherever he is ....... I can bet you on that one..

Trump is not even hiding it. The Man is so open about it.

He has said it that American Oil companies will soon go in and start revamping the Venezuelan Oil Sector...

American Oil companies will be drilling the Oil for the Venezuelan people and that Oil will be Sold in Dollars which favors the American Economy..

Every Global Super power today wants you to do business in their currency because they saw how that system has favoured the American Economy.

They are busy forming BRICS to move away from dollars and settle trade in their own currencies and America is smiling because America has other plans to make the dollar relevant..

As Long as the Dollar remains relevant, America will always be on top

America will always be 10 steps ahead of them because God Almighty made them number 1 for such a time as this...

And who God has blessed, no one can curse

God Bless America 🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸

God Bless Donald J Trump

God Bless Benjamin Netanyahu

I Stand with America and Israel Forever