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Nigeria's oil revenue dries up.


Amid the economic fallout from the COVID-19 pandemic, which has brought to a halt economic activity and travel, demand for crude has been crippled, resulting in a dramatic oversupply.

Accordingly, a glut of Nigerian oil has been bringing the country about $10 less than the $30 a barrel registered on Tuesday.

“It’s now dawned on everyone across the country how severe this threat is. There is a possibility that at least for three to five years, there’s going to be no revenue flowing to the government from oil,” Andrew Nevin, a partner and chief economist for Nigeria at PricewaterhouseCoopers LLP, told Blooomberg.
Amid the dire forecasts, Nigeria has sought a $3.4 billion loan from the International Monetary Fund (IMF) to shore up the country’s 2020 spending plan.

It’s also requested a further $3.5 billion from the World Bank and other financial institutions.
In late April, the IMF reviewed its earlier forecast of an anticipated 2 per cent growth of Nigeria’s economy, predicting it would shrink by 3.4 percent in 2020.

According to the IMF, crude revenues were predicted to decline by $26.5 billion this year, down from $54.5 billion in 2019.
With oil making up 9 percent of the Nigerian economy, crude exports fetch over 90 per cent of foreign exchange earnings.

“This is a period of crisis. Job losses are imminent across the petroleum industry. The impact of this will start reflecting from June and July."
“The reality is that some members will certainly be impacted."

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