₦airaland Forum

Hi all.
I hopee this is the right thread for this post, but in any case I think it'll get the best views here.

This article was prompted by news that Oil Swap deals were scrapped due to corruption.
I think that was a very wrong move.
Please, bear with me.
As at August, the following recent events have happened:
- China's stock slump;
- Leading to world stock slide;
- Leading to oil hitting $40/barrel or less this week (our budget is based on oil prices of aboiut $52/barrel).
Meaning that we've been running Nigeria on a deficit!

Add the following:
- Iran sanctions lifted
(Leading to their 2.8 million barrel/day stockpile- since 2011- ready for a saturated oil market)
- Saudi selling at a discount;
- US, China and India (our biggest customers) going elsewhere to buy;
- Western nations giving security alerts to their citizens about Nigeria;
- Our Naira STILL falling in value against other currencies (forget the CBN's battle with the dollar and check the prices of the Pound or Euro);

And to top it all up we're now terminating contracts with the FEW customers who actually WANT to buy our light crude?!
Isn't that cutting off your nose to spite your face?
How about simply checking shipping records with Lloyds of London to know who actually delivered the crude they collected and who lifted refined products- as well as dates, cargo load, travel durations, etc?
That way you can keep your genuine clients instead of tempting them to look elsewhere!
Or is the new round of tendering free for old customers..?

To be continued.
Next- Oil Partnerships (a la Olu Falae!).

As usual, feel free to criticize, shoot holes in my analysis, ask questions or make suggestions.
Tnx

OK

Most countries don't have crude oil and are more developed than Nigeria. The govt needs to find other means of generating income

I would like the opportunity to learn.

debaj10:
Hi all.
I hopee this is the right thread for this post, but in any case I think it'll get the best views here.

This article was prompted by news that Oil Swap deals were scrapped due to corruption.
I think that was a very wrong move.
Please, bear with me.
As at August, the following recent events have happened:
- China's stock slump;
- Leading to world stock slide;
- Leading to oil hitting $40/barrel or less this week (our budget is based on oil prices of aboiut $52/barrel).
Meaning that we've been running Nigeria on a deficit!

Add the following:
- Iran sanctions lifted
(Leading to their 2.8 million barrel/day stockpile- since 2011- ready for a saturated oil market)
- Saudi selling at a discount;
- US, China and India (our biggest customers) going elsewhere to buy;
- Western nations giving security alerts to their citizens about Nigeria;
- Our Naira STILL falling in value against other currencies (forget the CBN's battle with the dollar and check the prices of the Pound or Euro);

And to top it all up we're now terminating contracts with the FEW customers who actually WANT to buy our light crude?!
Isn't that cutting off your nose to spite your face?
How about simply checking shipping records with Lloyds of London to know who actually delivered the crude they collected and who lifted refined products- as well as dates, cargo load, travel durations, etc?
That way you can keep your genuine clients instead of tempting them to look elsewhere!
Or is the new round of tendering free for old customers..?

To be continued.
Next- Oil Partnerships (a la Olu Falae!).

As usual, feel free to criticize, shoot holes in my analysis, ask questions or make suggestions.
Tnx

These are visible facts but the dumb and illiterate sai buhari crew will only call it wailing and.go spiritual afterwards.

Truth is Nigeria is in for a huge shocker by 2016 if nothing is immediately done.

Oil has distracted us for long enough, our focus should be on agriculture and solid mineral development; a diversified economy would serve as a buffer for such shocks in the future.

In the interim, we should work on maximizing the output of our refineries to meet local demand and concentrate on buyers interested in transactions that exclude swaps, while OPA's should also be terminated as soon as possible.

Dear OP, the swap deals that were cancelled was not for the sale of crude oil as you alleged but for the refining of NNPC's allocation for local consumption.

To break it down for you, federal government allocates 445,000 barrels of crude oil daily to NNPC. NNPC is supposed to refine this in Nigeria to meet local consumption. But, due to the state of our refinery, NNPC could not refine the crude allotted to them, so, they entered into a swap deal with foreign oil dealers and refineries to give them crude oil and take back refined products. The details of this SWAP deals is what is enmeshed in corruption as it was reported that Nigeria is not getting good value in return for the crude we are giving. So, the president did the right thing by cancelling it.

Nigeria as a State and Nigerians should shift its focus from oil as there is so much more we can achieve outside oil.