There is hope in the horizon for Nigeria as the price of Brent Crude inched up by 74 cents or 1.7% to close at $45.17 a barrel on Wednesday.
This is the highest since early March 2020 before the Coronavirus pandemic sent oil prices tumbling to as low as $20 per barrel.
The rising prices come against the backdrop of a surge in coronavirus cases which could threaten a recovery in fuel demand as global coronavirus deaths surpassed 700,000 on Wednesday, according to a Reuters tally, with the United States, Brazil, India, and Mexico leading the rise in fatalities.
This rising price in crude will be a welcomed development for Nigeria whose economy is largely dependent on crude oil earning.
Recall that Nigeria’s economy is about 97% dependent on external earnings from crude oil. The country has been grappling with an economic crisis associated with falling crude earnings occasioned by the COVID 19 pandemic and glut in global storage capabilities.
Due to the declining oil prices, Nigeria has been forced to revise the 2020 budget oil benchmark twice.
Nigeria had initially placed the 2020 budget benchmark at $57 a barrel before an unprecedented crash in crude oil prices globally caused by the coronavirus pandemic forced the country to revise the benchmark to $30 to a barrel.
Further crash in crude oil prices forced the country to revise the oil benchmark a second time to $20. As a result, the country’s economy was badly hit by the low crude oil as revenue as foreign exchange earnings were heavily affected.
This rising price in crude will be a welcomed development for Nigeria whose economy is largely dependent on crude oil earning.
