19 October 2016, Lagos – As the global crude oil benchmark continued to trade above the $50 per barrel mark on Tuesday, economic and energy experts said the price rally would help soften the recession rocking the country and support economic recovery.
They, however, described as more important the need to ramp up the nation’s crude oil production, which has been significantly disrupted by the recent upsurge in militant attacks in the Niger Delta.
The militant attacks on oil and gas facilities pushed oil shipments to as low as 1.38 million barrels per day in August from a high of 2.1 million bpd in January.
The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, said late last month that production had risen to 1.7 million bpd.
Brent crude, against which Nigeria’s oil is measured, had jumped to a one-year high of $53.73 per barrel last week. It traded around $52 per barrel on Tuesday.
The Chief Executive Officer, Financial Derivatives Company Limited, Mr. Bismarck Rewane, in a telephone interview with our correspondent, said the rise in oil price would go a long way in getting the country out of recession, stressing the need for production to increase.
He said, “I am more optimistic now about the prospect of getting out of the recession. One, the price is good; two, the production is up; and three, the Nigerian President and the economic management team are not in denial as to the fact that we have an economic crisis. Therefore, they are unlikely to take it lightly; they will use every resource that comes their way and apply it diligently towards economic recovery and stimulus package.
“So, it is a positive news. But it is not exogenous variables like oil price that will do the trick; the game changer is the tenacity of the Nigerian leadership to stay the course. Variables within our control are the things that are going to get us of the recession.”