Oil price increase reverses Nigeria’s economic growth prospect by 0.7% -IMF

Solomon Ezeme

Recent steady increases in international crude oil prices have exposed underlying economic losses to Nigeria by  0.7percent. This was contained in the “April 2022 World Economic Outlook” of the International Monetary Funds (IMF) in which it reviewed the country’s growth rate to reflect present realities in the global market.

This represents what could have accrued to the country if oil production projections were on course as contained in the country’s 2022 budget . The current loss of 0.7% growth opportunity is the continuation of periodic losses of 2.7% to 3.4%, EnergyDay gathered.

The IMF’s World Economic Outlook” especially as affected by the ongoing war between Russia and Ukraine that has impacted the crude oil supply chain while  increasing  prices since late February.

The IMF had stated that the growth potential of the country’s economy may increase by 0.7% due to the increases recorded in  crude oil prices.

Before the recent adjustment, the international agency had earlier in January this year put Nigeria’s economic growth potential at 2.7% for 2022.

The report which equally revealed inflation projections in advanced economies  projected a 3.8% growth potential for sub-Saharan Africa.

It explained that the oil price increases would also boost the chances of crude oil export by Nigeria and other oil exporting nations in the sub-region, in 2022. 

“The increase in oil prices has however lifted growth prospects for the region’s oil exporters, such as Nigeria. Overall, growth in sub-Saharan Africa is projected at 3.8 per cent in 2022,” the report stated.

The IMF Report  however failed to highlight the growing spate of crude oil theft and production disruptions in the country’s  oilfields.