News
Nigeria Risks Another Recession As Global Oil Fight Begins
Saudi Arabia plans to unilaterally increase oil output next month, a move that could further reduce prices, reliable sources told Bloomberg. Such a move could make matters worse for oil-dependent countries like Nigeria.
Recall that the price of crude reduced Friday after oil producers failed to agree on oil cuts at an oil producers meeting.
Members of the Organisation of Petroleum Exporting Countries, OPEC, resolved on Thursday to cut crude oil production by a combined volume of about 1.5 million barrels per day, to stop further reduction in international oil price.
The cut would have been about 1.5 per cent of current global crude oil supplies of over 300 million barrels per day.
OPEC said that the burden of the cut would be shared with non-OPEC allies, led by Russia.
However, on Friday, Moscow rejected the plan and said countries were free to export as much oil as they could from March ending when the current deal ends.
Responding aggressively to the collapse of its OPEC+ alliance, Saudi Arabia plans to increase oil output next month, going well above 10 million barrels a day.
“Saudi Arabia is now really going into a full price war,” Bloomberg quoted managing director for the Middle East at oil consultant FGE, Iman Nasseri, as saying.
Already, Saudi Arabia has begun to show its mettle as it, on Saturday, slashed the price it sells crude into foreign markets.
The price slash offered unprecedented discounts in Europe, the Far East, and the U.S. and enticed refiners to purchase Saudi crude at the expense of other suppliers, Bloomberg reported.
The big price slash may be an effort to force Russia and other producers back to the negotiating table.
According to the report, Saudi Arabia, the world’s largest Oil Exporter, has privately told some market participants it could raise production much higher if needed, even going to a record of 12 million barrels a day.
Saudi production is likely to rise above 10 million barrels a day in April, from about 9.7 million a day this month, before going to as high as 12 million barrels.
“That’s the oil market equivalent of a declaration of war,” a commodities hedge fund manager told Bloomberg.
Nigeria makes most of its foreign earnings from oil. The current price of oil is already well below the $57 a barrel Nigeria benchmarked its 2020 budget, with planned daily production put at 2.18 million barrels.
Currently, Nigeria produces about 2 million barrels daily.
According to details on oil data site, international benchmark Brent crude slid 9.4 per cent to settle at $45.27 per barrel on Friday while Nigeria’s Bonny light sold at $46.33 per barrel sliding at about 10.8 percent.
With oil demand being overwhelmed by the coronavirus outbreak, if Saudi pumps more oil as it planned by April, oil prices will fall further, a move that could further affect Africa’s largest economy.
“This is going to get nasty,” Bloomberg quoted Doug King, a Co-founder of the Merchant Commodity Fund. “OPEC+ is going to pump more, and the world is facing a demand shock. $30 oil is possible.”
Last week, Nigeria’s Finance Minister, Zainab Ahmed, called for a review of the budget as she said the outbreak of Covid-19 (coronavirus) negatively impacted Nigeria’s oil revenue.
Already, experts fear Nigeria could slide into a recession if the price of crude continues to slide.
Between April and June 2016, Nigeria slipped into a recession caused by a critical fall in global oil price.
The oil prices fell from about $112 per barrel in 2014 to below $50 dollars per barrel in 2016.
Since Nigeria recovered from its last recession, President Muhammadu Buhari promised to diversify the Nigerian economy from being oil-dependent. That, however, is still a long way from being achieved.
Already, Nigeria’s ability to cushion any effect of global oil price has been weakened as the country’s Excess Crude Account dropped to about $71 million in February from over $2 billion in November 2018.
Reacting to the Saudi move and a potential drop in oil price, a financial analyst, Tope Fasua, said Nigeria is not prepared for the economic eventuality.
He said if the oil price gets to $30 per barrel, it may mean a recession for Nigeria because the oil sector is a major part of the economy.
“All these other countries are prepared, they have enough reserves Saudi Arabia has trillions of dollars in its reserve shelving it for it sovereign wealth fund, Russia equally has quite a bit of reserve and sovereign wealth fund.
“Already Nigerian economy is in trouble, I think that’s why they intended to borrow $22.7 billion loans because the loan is for every other budget item,” he said.
News
Court jails two for N22.1m fraud in Maiduguri
Justices Aisha Kumaliya and Amina Ibrahim of the Borno State High Court, sitting in Maiduguri on Tuesday, convicted and sentenced two persons to three years imprisonment each for fraud.
The convicts are; Anaryu Akindaraju and Umar Alhaji Bukar who were prosecuted by the Maiduguri Zonal Directorate of the Economic and Financial Crimes Commission, EFCC, on one-count separate charges bordering on criminal misappropriation and cheating.
According to the Head of Media and Publicity, EFCC, Dele Oyewale, Akindaraju was convicted by Justice Kumaliya while Bukar was jailed by Justice Ibrahim.
The charge against Akindaraju reads: “That you, Anaryu Akindaraju, sometime in March, 2022 in Maiduguri, Borno State within the jurisdiction of this Honourable Court, dishonestly induced Alhaji Tijjani Muhammad to deliver to you the sum of N15,000,000.00 (Fifteen Million Naira) via your account number 0241908016 domiciled with FCMB, and vide your account number 0060784408 domiciled with Access Bank respectively, while some of the monies were transferred to you vide the account number 1010381257 bearing Abubakar Musa domiciled with UBA under the guise that the said amount represents payment for a purchase of three bed room flat situated at House of Assembly Quarters Maiduguri, Borno State, which you are yet to deliver and thereby committed an offence contrary to Section 320 (a) and punishable under Section 322 of the Penal Code Cap. 102 Laws of Borno State”
That of Bukar reads: “That you, Umar Alhaji Bukar with National Identification Number 86732517860, sometimes in 2013 at Maiduguri Borno State within the jurisdiction of this Honourable Court, dishonestly misappropriated the aggregate sum of N6,736,000.00 and a house estimated at N450,000.00 belonging to late Alhaji Bukar Fannami for the benefit of Aisha Bukar Fannami and Hauwa Buakr Fannami and thereby committed an offence contrary to and punishable under Section 308 and 309 of the Penal Code Law of Borno State Cap. 102 Vol. 3 of 1994 respectively.”
Oyewale said they all pleaded guilty to the charges when read to them and counsel for the prosecution Mukhtar Ali Ahmed, Faruk Muhammad and Abdulmalik D. Aliyu went ahead and prayed the court to convict and sentence them accordingly.
“Justice Kumaliya convicted and sentenced Akindaraju to two years imprisonment or a fine of N200,000.00 while Justice Ibrahim convicted and sentenced Bukar to one year imprisonment or an option of fine of N100,000.00.
“The convicts’ road to the Correctional Centre began when Akindaraju received payment for a purchase of a three bed room flat without delivering the property to the victim or returning the money to him.
“Bukar, on his own, dishonestly misappropriated an inheritance property and converted it to his use”.
News
Interior Minister Tunji-Ojo orders investigation of alleged criminal activities at Delta correctional centre
The Minister of Interior, Olubunmi Tunji-Ojo, has ordered an immediate and thorough investigation into allegations of criminal activities within the Okere Correctional Centre in Warri, Delta State.
A recent armed robbery incident in Delta State was allegedly traced to inmates of the correctional centre.
Tunji-Ojo’s directive was contained in a statement issued by the Special Assistant to the Minister on Media and Publicity, Babatunde Alao, on Tuesday in Abuja.
The minister strongly condemned the alleged reprehensible behaviour, stressing that any form of indiscipline or misconduct would be met with severe consequences.
He reiterated his commitment to upholding the highest standards of integrity, transparency, and accountability in the administration of justice within the correctional service system.
“I will not allow indiscipline to fester under my watch. Any officer found wanting will face the full weight of the law. The leadership of the Nigerian Correctional Service must provide explanations.
“We take these allegations seriously and will not tolerate any form of misconduct within our correctional facilities,” he stated.
The minister urged the general public to provide any relevant information that may aid the investigation.
Politics
‘You’re backing Tinubu for personal gains’ — El-Rufai slams Kaduna Gov Sani
The immediate past governor of Kaduna State, Nasir El-Rufai, has criticised his successor, Governor Uba Sani, for supporting President Bola Tinubu, alleging that it is for personal gain.
In a post on X, El-Rufai claimed that Sani’s unwavering support for Tinubu was linked to over N150 billion in federal reimbursements received by Kaduna State in the past 18 months.
“Every day I see this governor embarrassingly and sycophantically rambling, I used to wonder why. However, confirming that Federal Government ‘reimbursements, interventions, and grants’ in excess of N150bn have been given selectively to Kaduna by Tinubu in the last 18 months now explains everything.
“By all means, defend Asiwaju for the conditional cash transfer. Asiwaju has earned it, coming from you. The people of Kaduna State will judge at the right time and place. Have a nice day,” El-Rufai wrote.
The former governor’s criticism comes in the wake of Sani’s remarks during a news interview on Monday, where he expressed surprise at the growing criticism of Tinubu’s administration from some founding members of the All Progressives Congress.
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