Chiedu Ebie leads Millennium Oil & Gas Company Ltd., a major production and exploration company in Nigeria. As managing director, Chiedu Ebie tracks the crude oil prices of Nigerian and other grades.
Oil is vital to Nigeria's economy. Some 80 percent of government revenues come from sales of that nation's Bonny light petroleum. It also accounts for 85 percent of Nigeria's earnings on foreign exchanges.
Prices have declined significantly in the past year, despite some increases in 2015. As of April, prices are around $60 per barrel.
Nigeria's finance minister stated prices will probably not return to the 2011-2013 level of about $100 per barrel. Speaking at a meeting of the International Monetary Fund, she warned this could be a permanent blow to the nation's economy. She projected per-barrel rates of $60 to $70 for the next year.
The decline affects Nigeria more severely than the Persian Gulf producers. Already, oil and gas operators in Nigeria are scaling back on capital spending for 2015 due to the uncertainty in oil prices. Projects worth over $100 billion are expected to be put on hold this year as current oil prices make them uneconomical. Millenium is not left out in this regard as budget cuts and reviews have already taken place in light of this development. Compared to other nations, Nigeria has smaller exchange reserves.
Nigeria has responded by cutting government expenditures and taxing luxury items, such as yachts. For the long term, the finance minister said, the nation should build a more diverse economy.
Oil is vital to Nigeria's economy. Some 80 percent of government revenues come from sales of that nation's Bonny light petroleum. It also accounts for 85 percent of Nigeria's earnings on foreign exchanges.
Prices have declined significantly in the past year, despite some increases in 2015. As of April, prices are around $60 per barrel.
Nigeria's finance minister stated prices will probably not return to the 2011-2013 level of about $100 per barrel. Speaking at a meeting of the International Monetary Fund, she warned this could be a permanent blow to the nation's economy. She projected per-barrel rates of $60 to $70 for the next year.
The decline affects Nigeria more severely than the Persian Gulf producers. Already, oil and gas operators in Nigeria are scaling back on capital spending for 2015 due to the uncertainty in oil prices. Projects worth over $100 billion are expected to be put on hold this year as current oil prices make them uneconomical. Millenium is not left out in this regard as budget cuts and reviews have already taken place in light of this development. Compared to other nations, Nigeria has smaller exchange reserves.
Nigeria has responded by cutting government expenditures and taxing luxury items, such as yachts. For the long term, the finance minister said, the nation should build a more diverse economy.