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Nigeria faces breaking point as India’s global crude oil demand drops by 70%

India, one of Nigeria’s largest crude oil buyers has reduced its demand for crude oil by a whopping 70%.

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260 Nigerians set to be evacuated from India – FG, Nigeria faces breaking point as India's global crude oil demand drops by 70%, crude oil demand

India, one of Nigeria’s largest crude oil buyers has reduced its demand for crude oil by a whopping 70%. On March 23rd, India imposed a 3-week lockdown bringing the economy of the 1.3 billion strong population to a halt.

The total number of coronavirus cases in India rose to 6,412, while the death toll is now 199, according to the country’s health ministry. Before the lock-down, India had about 519 cases effectively rising 12 folds in under a month. India’s nationwide lockdown is currently the largest in the world.

India’s crude oil demand is estimated at about 5 million barrels of crude oil per day and the demand drop could snuff out about 3.5 million of crude off the global markets. On Thursday, OPEC member countries agreed with non-OPEC countries like Russia to cut crude oil output by 10 million barrels per day.

What this means: Nigeria relies on India for about 13% of its exports, the highest when compared to any other country. Nigeria’s export revenue to India was N628.4 billion in the last quarter of 2019 alone out of which N592.5 billion (94%) was from Crude Oil alone. Total crude oil export earnings from the country were about N3.62 trillion in the 4th quarter of 2019 alone. Nigeria’s total export to India was N2 trillion in 2019.

Nigeria’s reliance on India for crude exports shows a 70% drop in crude oil demand will significantly impact on Nigeria’s crude oil export earnings. Last month, the Group Managing Director of the NNPC complained that Nigeria had over 50 unsold cargoes of crude as oil-producing countries flood global markets with cheap crude.

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Should, India’s demand for Nigeria’s crude fail to pick up later in the year, it could have a significant impact on Nigeria’s revenue situation and could further trigger another round of devaluation for the country.

Nairametrics reported earlier that Shell has declared force majeure on exports of Nigerian Forcados crude oil. The Trans Forcados pipeline exports about 240,000 barrels of crude daily. The Trans Forcados pipeline is one of Nigeria’s main crude oil terminal and was often a target of pipeline vandals and oil militants. Nigeria produces about 2 million barrels of crude daily and earned about $54 billion from crude oil and gas exports in 2019.

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Nairametrics is Nigeria's top business news and financial analysis website. We focus on providing resources that help small businesses and retail investors make better investing decisions. Nairametrics is updated daily by a team of professionals. Post updated as "Nairametrics" are published by our Editorial Board.

1 Comment

1 Comment

  1. Jerry Von

    April 10, 2020 at 12:31 pm

    Diversify, diversify, govt nor hear, now they want to build steel industry and hectares of farm in 3days. We will need a Miracle.

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Coronavirus

Covid-19: US to have enough vaccines for vulnerable Americans by end of 2020

The US said it is likely to have enough safe and effective COVID-19 vaccines to inoculate Americans by the end of 2020.

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AstraZeneca suspends COVID-19 vaccine final stage trial over safety concerns, COVID-19: J&J starts vaccine trials on humans after success on monkeys

The United States, On Wednesday, revealed that the country is likely to have enough safe and effective COVID-19 vaccines available to inoculate the most vulnerable Americans by the end of 2020.

The U.S. government is cautiously optimistic that one or two vaccines, likely from Pfizer Inc or Moderna Inc, will be available by the end of the year, and can begin to be distributed to Americans, officials said during a news conference.

This was disclosed by the United States Secretary of Health and Human Services, Alex Azar, on Wednesday, October 22, 2020.

Azar said he expected that all seniors, healthcare workers, and first responders would be able to receive vaccines as soon as January, with the rest of the American public able to get vaccines by April.

Companies participating in the U.S. government’s effort to develop vaccines for COVID-19, dubbed Operation Warp Speed, have begun developing manufacturing capabilities even before any vaccination has been authorized by regulators.

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Nairametrics had reported that in an open letter, the Chief Executive Officer of Pfizer Inc, Albert Bourla, disclosed that it could seek emergency use authorization of Covid-19 vaccine in the US by late November, after the US presidential election.

The coronavirus outbreak has been worsening in recent weeks as cold weather pushes Americans indoors, raising the chance of contracting the virus. Some 38 U.S. states and two territories have reported rising case counts. More than 8 million Americans have been infected with the novel coronavirus and more than 200,000 have died.

What this means: This announcement rules out the assertion by US President, Donald Trump, that a Covid-19 vaccine would be ready before the Presidential election. This is also a huge boost for the country, which has suffered the heaviest casualties globally from the pandemic.

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Business

IGP orders immediate withdrawal of police officers attached to VIPs

The IGP has ordered the immediate withdrawal of police officers attached to all VIPs across the country.

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The Inspector-General of Police (IGP), Mohammed Adamu, has ordered the immediate withdrawal of police officers who are attached to all Very Important Persons (VIPs) across the country.

According to media reports, those exempted from the IGP’s directive, are police officers attached to Government Houses, the Senate President, and the Speaker House of Representatives.

The directive was contained in a police wireless message dated October 21, 2020, that was sent virtually to Zonal Assistant Inspector General of Police and State Commissioners of Police with reference number, CB:4001/DOPS/SPU/FHQ/ABU/VOL./ORDER.

The statement said, “any commander who violates this order will bear the consequences.”

This is new directive is coming barely 10 days after the police authorities disbanded the Special Anti-Robbery Squad (SARS), following nationwide protests against the squad for high handedness and extrajudicial killings.

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The signal, which was signed by the AIG POL, Protect, Force Headquarters, Abuja, partly read, “Any protect personnel found escorting or guarding any VIP with or without a firearm is deemed to be deployed by the commander and the commander will be sanctioned.”

It further directed the affected personnel to report to their respective command Commissioners of Police.

It can be recalled that successive IGPs have issued similar orders in the past, which were barely implemented.

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In another development, the IGP has sent emissaries to the Chairman, Police Service Commission (PSC), Musiliu Smith, in a bid to have a smooth working relationship with the retired police boss.

It was gathered that two former IGs, Mike Okiro and Suleiman Abba; visited the PSC Chairman at his office in Abuja on Wednesday, following Smith’s refusal to meet with Adamu on several occasions.

A source explained that Okiro and Abba spent over three hours trying to persuade Smith to reconcile with the IG, who has been at loggerheads with the PSC over the recruitment of constables into the Nigeria Police Force.

What this means: This appears to be part of measures aimed at kick-starting the much talked about reforms in the Nigerian Police Force. The full implementation of this order will make more police officers available to provide security to Nigerians as a huge number of the force provides security to private individuals and companies, in a country that is greatly under policed.

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Coronavirus

COVID-19 Update in Nigeria

On the 21st of October 2020, 37 new confirmed cases were recorded in Nigeria

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The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to record increases as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 61,667 confirmed cases.

On the 21st of October 2020, 37 new confirmed cases were recorded in Nigeria, having carried out a total daily test of 4,648 samples across the country.

To date, 61,667 cases have been confirmed, 56,880 cases have been discharged and 1,125 deaths have been recorded in 36 states and the Federal Capital Territory. A total of 595,283 tests have been carried out as of October 21st, 2020 compared to 590,635 tests a day earlier.

COVID-19 Case Updates- 21st October 2020,

  • Total Number of Cases – 61,667
  • Total Number Discharged – 56,880
  • Total Deaths – 1,1125
  • Total Tests Carried out – 595,283

According to the NCDC, the 37 new cases were reported from 9 states – FCT (8), Lagos (7), Taraba (5), Rivers (5), Adamawa (4) Kaduna (3), Anambra (2), Osun (2), Ogun (1).

Meanwhile, the latest numbers bring Lagos state total confirmed cases to 20,733, followed by Abuja (5,943), Plateau (3,587), Oyo (3,421), Rivers (2,742), Edo (2,648), Kaduna (2,572), Ogun (1,987), Delta (1,812), Kano (1,741), Ondo (1,659), Enugu (1,314),  Kwara (1,050), Ebonyi (1,049), Osun (918), Katsina (904), Abia (898), Gombe (883).  Borno (745), and Bauchi (710).

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Imo State has recorded 607 cases, Benue (484), Nasarawa (478), Bayelsa (403),  Ekiti (329), Jigawa (325), Akwa Ibom (295), Anambra (277), Niger (274), Adamawa (248), Sokoto (162), Taraba (117), Kebbi (93), Cross River (87), Zamfara and Yobe (79), while Kogi state has recorded 5 cases only.

READ ALSO: COVID-19: Western diplomats warn of disease explosion, poor handling by government

Lock Down and Curfew

In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.

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The movement restriction, which was extended by another two-weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.

On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020. Also, on Monday 27th July 2020, the federal government extended the second phase of eased lockdown by an additional one week.

On Thursday, 6th August 2020 the federal government through the secretary to the Government of the Federation (SGF) and Chairman of the Presidential Task Force (PTF) on COVID-19 announced the extension of the second phase of eased lockdown by another four (4) weeks.

READ ALSO: Bill Gates says Trump’s WHO funding suspension is dangerous

 

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