Nigeria Losing Ground in Changing Oil World
From Yahoo News
By Joe Brock
Nigeria will earn less for its oil and struggle to replace reserves unless it can end years of industry stagnation, at a time its biggest customer is becoming self-sufficient and African rivals are boosting supplies.
A domestic energy boom in the United States has already sharply cut demand for Nigerian oil, while legal uncertainty, political wrangling, corruption and insecurity plague an oil industry which is still Africa’s biggest.
In addition, rivals on the continent – both East and West – are fast catching up, and hungry for returns to boost their smaller economies they are tempting foreign oil and gas companies with better terms and fewer bottlenecks than Nigeria.
“Nigeria has multiple problems in its oil game – it has failed to meet reserve growth and production targets for many years … while competition grows worldwide,” said Duncan Clarke, Head of African oil experts Global Pacific & Partners.
“High crude prices have shielded Nigeria of late – but this may not last forever, and its reputation as the proverbial Land-of-No-Tomorrow continues.”
With oil accounting for around 80 percent of government revenue and 95 percent of foreign exchange reserves, Africa’s second largest economy is vulnerable to any negative shifts in oil and gas prices and demand.
