Summary
- Nigerian oil production and consumption have remained relatively stagnant.
- Nigeria’s population is growing at a rapid pace.
- Internal conflicts are causing other countries to try to decrease business with Nigeria.
Nigeria is a federal constitutional state comprised of thirty-six states and their federally controlled land. The country has a population of 174 million, which has been rapidly growing from 45 million in 1960 and 96 million in 1990.
Population
Looking at the population of Nigeria, we see that, unlike the United States of America, and more so like Ethiopia, the growth has actually sped up in recent decades. As we will later see, this has major implications.
Nigerian Fertility Rate – Google
However, population growth only explains the current population. If we want to look at future population – even more so the number of people that will be growing up to consume oil – we need to look at the fertility rate.
Here, the fertility rate paints a picture of even faster population growth. While Ethiopia and Kenya, both countries that have been experiencing rapid population growth, have seen their population decline from 7 and 8 births per woman to 4.64 and 4.46, respectively, Nigeria’s fertility rate has remained relatively constant over the past decades. This point towards a picture of even quicker future population growth.
Current Oil Situation
Before we can talk about why Nigeria’s oil exports will decrease, first we must talk about the current oil situation in Nigeria.
Parliament approved the reduction in subsidies to 100 billion naira ($505 million) for 2015, Finance Minister Ngozi Okonjo-Iweala said late on Tuesday.
The cuts were accounted for in last week’s 4.49 trillion naira budget for 2015, but the breakdown was not announced until Tuesday.
Lawmakers also approved 45.5 billion naira for a separate kerosene subsidy.
In November, the government said it hoped to gradually phase out the subsidies, reducing them to 408.68 billion naira next year and 371.18 billion naira for 2017.
Okonjo-Iweala said in her budget speech that the government had already spent half of the amount it had planned to borrow and that it had not released any funds for capital expenditure this year on account of lower oil revenue.
This year’s budget took longer than usual getting through parliament, worsening a cash squeeze in government, because of the closely fought general elections in March that saw incumbent President Goodluck Jonathan defeated by opposition leader Muhammadu Buhari.
He will take office later this month.
Nigeria tried to end subsidies in 2012 doubling the price of a litre of petrol overnight to 150 naira ($0.93), from about 65 naira, in efforts to cut government spending and encourage badly needed investment in local refining.
The move angered citizens who see cheap pump prices as the only benefit they derive from living in an oil-rich country and lead to 8 days of nationwide strikes. The government later reinstated part of the subsidy to end the strikes.
Oil Production and Consumption in Nigeria – BP
In recent years, Nigeria has had to deal with attacks on its oil infrastructure. However, despite this, the country has maintained relatively stable levels of total oil production and consumption.
This, followed by a recovery in production after an amnesty was declared, has resulted in Nigerian exports remaining relatively constant over the past decade or so at roughly two million barrels per day.
(click to enlarge)
World Oil Reserves – Wikimedia
Although not as significant as Venezuela, the Middle East, or Canada, Nigeria has a considerable amount of proven oil reserves. At the last estimate, the country had proven reserves on the order of 37.2 billion barrels. At its current rate of usage, the country has enough proven oil reserves to last it for 45 years compared to 10 years for the United States.
However, one thing to note is that proven oil reserves are always subject to change – it is just dependent on how much investment the country is receiving. The United States, which receives more oil investment than almost any other country in the world, has seen its reserves remain stable despite decades of heavy usage. Should Nigeria receive more investment, its reserves will also increase rapidly.
Future
As you can see, the above images paint a relatively stagnant picture of Nigeria. The population is growing, but the country’s oil consumption and production have remained relatively constant. However, I expect things to change.
The world’s energy demand is increasing, mainly driven by developing countries like Nigeria. This is also coupled with the fact that conflicts are decreasing the Nigerian exports, which will lower internal prices, and thus increase demand.
Global Progress Drives Demand – Climate Gate
As you can see in this energy outlook chart from Exxon Mobil (NYSE:XOM), the company expects the world’s energy demand to grow at a 1.2% rate over the following decades despite an only 0.9% rate of population growth. Since developed countries are widely expected to actually see their oil usage decrease over the coming decades in an attempt to help the environment, much of this new growth is expected to be from developing countries.
As a result, countries like Nigeria will see oil demand grow rapidly. But since Nigeria has relatively limited reserves and the infrastructure prevents it from significantly ramping up its production, less oil will be leaving the country, the same as Nigeria decreasing its exports. Because, I can almost assure you that if Nigeria’s consumption demand rises, it is not going to import oil so that it can continue to export oil at the same rate.
U.S. Imports from Nigeria – Oil Price
More so, other countries have been importing less U.S. oil. Nigeria has seen its exports to the United States drop rapidly in recent years. Much of this can be attributed to Boko Haram and other conflicts. Americans do not like importing their oil from areas viewed as “unstable”, or “conflict regions”.
Oil is one giant worldwide supply and demand chain built on hundreds of miniature supply and demand chains. Nigerian exports to the United States are one such supply and demand chain. Should other countries decrease their demand for Nigerian oil, more will stay in the country.
As producers look for alternative sources to distribute Nigerian oil, one thing that will occur is Nigerian gas prices will decrease. In fact, at $1.79 per gallon, Nigerian gasoline prices are relatively cheap. The reason why European countries use less oil per capita than the United States is partly because American gasoline is cheaper, and cheaper gasoline drives increased internal demand.
Conclusion
Nigeria’s historical oil production and consumption do not point towards any significant trends. However, Nigeria has experienced a rapid increase in population – faster than almost any other African country. This, coupled with the fact that I expect internal Nigerian oil prices to decrease driving demand, should result in Nigerian oil exports decreasing
FRENCH VERSION
Le gouvernement avait dit qu’il serait progressivement éliminerprogressivement les subventions aux combustibles qui sont unlourd fardeau pour les finances publiques, mais les risques desubventions coupe aggravant une crise de carburant dans lepays.
Grandes villes connaissent une pénurie d’essence paralysant queles importateurs de pétrole ressentir les effets des subventionsnon rémunéré, une monnaie locale chute et resserrement deslignes de crédit déclenchées par baisser de prix du pétrole brut,les commerçants de pétrole et les sources de l’industrie locale,dire.
Alors que le Nigeria est le plus grand producteur de pétrole de l’Afrique, un système de raffinage négligé, qu’il est presqueentièrement tributaire des importations pour les 40 millions delitres par jour d’essence qu’il consomme.
Introduction
Population
Population nigériane – Google
Taux de fécondité nigérian – Google
Cependant, la croissance démographique n’explique que lapopulation actuelle. Si nous voulons regarder futurs de lapopulation – encore plus que le nombre de personnes que vousdévelopperez à consommer huile – vers le haut, nous avonsbesoin de regarder le taux de fécondité.
Ici, le taux de fécondité dresse un portrait de croissance encoreplus rapide de la population. Tandis que l’Éthiopie et le Kenya, les deux pays qui connaissent une croissance démographiquerapide, ont vu leur population décliner de 7 et 8 naissances parfemme à 4,64 et 4,46, respectivement, les taux de fécondité du Nigéria est demeuré relativement stable durant les dernièresdécennies. Ce point vers un tableau de croissance encore plus rapide de la population future.
Situation actuelle de l’huile
Avant que nous puissions parler de pourquoi les exportations depétrole du Nigeria diminuera, tout d’abord, nous devons parlerde la situation actuelle du pétrole au Nigeria.
Le Parlement a approuvé la réduction des subventions à 100milliards de naira ($ 505 millions) pour 2015, le ministre desFinances Ngozi Okonjo-Iweala a déclaré tard mardi.
Les coupes ont été pris en compte dans le budget de naira 4,49billions de la semaine dernière pour 2015, mais la ventilationn’était pas annoncée avant mardi.
Législateurs a également approuvé 45,5 milliards de naira pourune subvention de kérosène distinct.
En novembre, le gouvernement exprimé le qu’espoir d’éliminerprogressivement les subventions, les réduire à 408,68 milliards denaira l’année prochaine et à 371,18 milliards de naira pour 2017.
Okonjo-Iweala a déclaré dans son discours du budget que legouvernement avait déjà passé la moitié de la somme, qu’il étaitprévu d’emprunter et qu’elle n’avait pas libéré les fonds pourdépenses en capital cette année en raison de la baisse desrevenus de pétrole.
Budget de cette année a pris plu de l’habituel : alertez Parlement,aggravation d’un retrait en espèces au sein du gouvernement, en raison des élections générales étroitement combattues en marsqui a vu les titulaires Président Goodluck Jonathan défait par lechef de l’opposition Muhammadu Buhari.
Il prendra ses fonctions ce mois-ci.
Nigeria essayé à la fin des subventions en 2012 doubler le prix dulitre d’essence durant la nuit à 150 naira ($0,93), d’environ 65naira, dans les efforts visant à réduire les dépenses dugouvernement et encourager l’investissement nécessaire dans leraffinage local.
Le déménagement a irrité les citoyens qui voient les prix à lapompe bon marché comme le seul avantage qu’ils dérivent devivre dans un pays riche en pétrole et conduisent à 8 jours degrèves dans tout le pays. Le gouvernement a rétabli plus tardpartie de la subvention à la fin de la grève.
La Production de pétrole et de la consommation au Nigéria – BP
Ces dernières années, Nigeria a dû faire face à des attaques surson infrastructure pétrolière. Cependant, malgré cela, le pays amaintenu des niveaux relativement stables de la productiontotale de pétrole et de la consommation.
Cela, suivie d’une reprise de la production après une amnistie a été déclarée, a donné lieu à des exportations nigérianes restantrelativement constante au cours de la dernière décennie, àenviron 2 millions de barils par jour.
Réserves mondiales de pétrole – Wikimedia
Bien que pas aussi importante que le Venezuela, le Moyen Orientou le Canada, le Nigeria
