Lower oil prices remain a threat to Nigeria’s recovery   

5th September, 2019 The prospect of high debt levels to China amid lower oil prices is something that must not be overlooked.

At the time of writing, Oil benchmarks come under continuous pressure from demand-side concerns, including recession fears stemming from trade disputes.

The money from Oil sales is the lifeblood of the Nigerian economy. In the worst-case scenario, if Oil prices start drifting lower there could be unwelcome consequences such as even slower GDP growth, job losses, sovereign debt defaults, less money in the fiscal budget for development, and constrained consumer spending. 

Reduced crude Oil sales would affect government revenues and reserves, meaning the capacity to fund projects will be weakened. Stock markets together with investor sentiment domestically and externally would be impacted and possibly even trigger capital outflows.

Reporting for EasyKobo on Thursday , 05 September 2019 in Lagos, Nigeria

Source:  Lukman Otunuga, Senior Research Analyst at FXTM.

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