Nigeria loses $1.134 billion (about N181.44B) as America cuts oil imports

Posted by News Express | 14 April 2014 | 4,088 times

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Nigeria’s total crude export declined by 13.45 per cent, between December 2012 and December 2013, leading to a loss of $1.134 billion, about N181.44 billion, due largely to a 90 per cent drop in crude oil exports to the United States which has stepped up production of shale oil and gas.

Specifically, the country recorded total crude export of 64.537 million barrels in December 2013, down by 10.03 million barrels from 74.564 million barrels recorded at the end of 2012.

As a result, the country earned $7.299 billion, about N1.168 trillion, from crude export as at December 2013, down by $1.134 billion (N181.44 billion) from $8.434 billion, about N1.349 trillion, recorded in December 2012.

KPMG Professional Services had in February warned that the discovery and exploration of shale oil and gas across the globe would put Nigeria’s economy at serious risk, unless the country was able to churn out policies that would bring about increased investment in the oil and gas sector and ensure stable power supply.

According to KPMG, Nigeria’s ability to finance its budget will be greatly threatened, unless it puts in place measures that will grow its crude production capacity, diversify the economy, as well as build additional crude oil refineries, saying that these will significantly reduce the effect of shale oil discovery on the country’s revenue.

“Shale oil discovery has created a lot of opportunities for international oil companies, IOCs, and has brought about stiff competition among crude oil producing countries,” it said, noting also that oil-producing countries would soon be in fierce competition with themselves to attract investments and market their crude.

The revenue decline is traceable to a 90 per cent drop in crude oil export to the United States in 2013, representing $1.452bn (N232.32bn), due largely to the production of shale oil and gas. According to the December 2013 Petroleum Information just released by the NNPC, Nigeria’s crude export to the US dropped to 1.438 million barrels as at December 2013 from 14.279 million barrels recorded in the same period in 2012, a volume drop of 12.841 million barrels or 90 per cent.

Using an average crude price of US$113.11 per barrel, this translates to crude export of $1.615 bn (N258.4bn) in December 2012 and $162.65 million (N26.024bn) as at the end of December 2013, representing a drop of $1.452bn ( N232.32bn) within a one-year period.

India, according to the report, has, therefore, overtaken the US as the highest importer of Nigeria’s crude, as the US which accounted for 19.15 per cent of Nigeria’s total crude export and 86.28 per cent of total crude export to North America as at the end of December 2012, dropped to the 10th highest importer of Nigeria’s crude, with 1.438 million barrels as at end December 2013.

India emerged the highest importer of Nigeria’s crude export for the month of December 2013, with 13.086 million barrels, followed by the Netherlands, with 9.866 million barrels, and France, with 4.497 million barrels.

Nigeria exported 4.869 million barrels of crude to Brazil in the period under review; Spain got 4.6 million barrels, while 3.895 million barrels of crude oil were exported to South Africa.

Others are Cote D’Ivoire — 1.898 million barrels; Thailand — 1.897 million barrels; and Australia — 1.862 million barrels.

The report further noted that by December 2013, Europe was the highest importer of Nigeria’s crude, accounting for 47 per cent of Nigeria’s total export; followed by Asia and Far East, accounting for 26 per cent; while Africa accounted for 12 per cent of Nigeria’s crude export.

South America accounted for 10 per cent of Nigeria’s total crude export, while Oceania/Pacific and North America accounted for 3 per cent and 2 per cent respectively.

•Text courtesy of LEADERSHIP. Photo shows Petroleum Minister Diezani Allison-Madueke.

Source: News Express

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