Why Gulf oil, gas producers should invest in Nigeria, by Tuggar
The Middle East conflict has shown why Gulf oil and gas producers should regard Nigeria as a partner, not a rival, to help diversify supply during crises, Foreign Minister Yusuf
The Middle East conflict has shown why Gulf oil and gas producers should regard Nigeria as a partner, not a rival, to help diversify supply during crises, Foreign Minister Yusuf Tuggar, said yesterday.
The remarks came as war in Iran disrupted shipments through the Strait of Hormuz, a corridor for about a fifth of global supply, forcing exporters to halt shipments and triggering price spikes.
Nigeria’s untapped reserves offer Gulf states an alternative source of crude and gas at a time when global flows are vulnerable and demand for hydrocarbons is set to remain strong for years, Tuggar said.
“It’s in line with what we’ve always advocated – that countries which might otherwise consider us competitors should partner with us and invest so they can diversify their market share, working with us,” he said.
Nigeria, long hampered by underinvestment, theft and pipeline vandalism, has lifted total output to about 1.7 million barrels per day from 1.4 million when President Bola Tinubu took office in 2023 and could grow further with new capital for fields and pipelines, Tuggar added.
Some analysts say U.S. and Israeli strikes on Iran, and Tehran’s attacks on Gulf states, could prompt the region to defer African bets, but Tuggar said the opposite could also prove true.
“It could make them want to work with countries like Nigeria that are rich in gas and oil … to diversify market share for the benefit of both countries, or they could hold back,” he told Reuters.
Nigeria and the United Arab Emirates signed a pact in January, the Comprehensive Economic Partnership Agreement, that Abuja says should unlock trade and investment.
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Qatar linked investors have also announced plans for investment in gas in Nigeria, though timelines remain unclear.
Analysts caution that headline investment promises often face long approval cycles and execution risks in Nigeria.
Tuggar said Nigeria has felt the pain of costlier oil because it imports large volumes of refined products, lifting transport and food prices, especially during the Muslim fasting month of Ramadan, when consumption typically rises.
But he said Nigeria was better placed to withstand longer term shocks as domestic refining expands.
The privately owned Dangote refinery says it is operating at name plate capacity of 650,000 barrels per day, enough to meet domestic needs.
Oil will remain “relevant for many years to come; at the moment the world consumes about 105 to 106 million barrels per day. I don’t see that changing much anytime soon, so we need to work together so we have enough hydrocarbons available,” Tuggar added.
