Nigeria faces a double blow: a potential oil accident and insecurity that has cut most of the activities in rural areas. These two vectors could potentially expire the 2025 budget and the 2026 budget which will soon be carried out before they even arise. If the price of oil crashes and people cannot even enter the farms due to insecurity, what then? We get closer to the Malthusian disaster and our options shrink.
Everyone is a victim: I closed Zenvus due to insecurity because he became dangerous to send young people to farms to deploy technologies for customers. My fear was as follows: if a young person is kidnapped to work for me, what would I tell the spouse, children and parents? To avoid this possibility, I closed the company and continued despite a huge contract from the Rice Farmers Association of Nigeria (Rifan).
Read Goldman Sachs on the trajectory of oil: “The prospect of world oil prices falling below $ 40 per barrel has sparked an alarm far beyond Wall Street, with new fears that go up to Nigeria on the fate of its fragile economy.
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“In a note on Monday which underlines the vulnerability of nations depending on oil, analysts of Goldman Sachs warned that Brent Crude – the international reference, could fall less than $ 40 by the end of 2026 in the worst case marked by a global slowdown and the collapse of the production cuts of OPEP +.”
At the center of the imminent crisis is the Budget plan of the Nigerian government in 2025, which is built around $ 75 per barrel oil benchmark. The country, which is still highly dependent on gross oil exports for income, projected an oil income target of 14 Billions of Nairas for 2025 – a figure that becomes a fantasy if Brent prices slip near the $ 40 mark.
Nigeria generally earns more than 70% of its currencies and approximately half of its government oil income. With production volumes which have difficulty exceeding 1.3 million barrels per day, well below OPEC quotas, the only way in which Nigeria has managed to maintain its somewhat balanced books is by high oil prices observed in recent years.
Nigeria’s insecurity is a huge threat and I hope people will understand how it will play on investment decisions, especially outside major cities. This problem has not started today and cannot be corrected overnight. But our leaders must be urgently. Whenever I remember my hobby-visit Nigeria’s university campuses to teach electronics, from Sokoto to IFE, Owerri in Kano, and beyond (see photos) and how it is impossible now, I feel bad. Our past should not be more memorable than the present! We must show urgency on the treatment of insecurity everywhere.
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