Oil prices are at a 4-month low of $70.36pb, down 6% in August alone. The tariff wars between the US and its allies and foes alike are taking its toll on the global economy. Aggregate oil demand is slipping and US crude inventories are building. This is coming at a time when Nigeria is experiencing a reversal of capital flows.
Nigeria’s oil production increased by 4% to 1.67mbpd in July, but it is still 27% below its budget benchmark of 2.3mbpd. The Nigerian economy is more vulnerable to production than price shocks. If oil prices decline further, it could have serious consequences on Nigeria’s external imbalances.
The attached slides contain a snapshot of recent commodity market movements and burning economic issues in Nigeria.
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