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Nigeria’s Crude Oil Nightmare



Nigeria is currently witnessing the worst  nightmare among her major oil exporting communities in Europe, Middle East and some parts of Africa in balancing a budget this year on a projection of $52.50 per barrel according to Fitch Ratings limited. To balance her budget, the country will need a crude oil per barrel price of $139.

The forecast break even oil prices of other African nation like Angola, Gabon, and Republic of Congo  were put at $82, $66, and $52 per barrel respectively.

According to Fitch, Saudi Arabia needs an oil price of $74 per barrel; Bahrain, $84; Russia $72; Kazakhstan , $71; Oman $75, Azerbaijan  $66; Iraq, $61; United Arab Emirates, $60; Qater, $51; and Kuwait at $45.

Bloomberg reported on Thursday  that 11 of the countries were unable to balance budget this year even after the Government cuts on her expenses including Saudi Arabia.

“Fiscal reforms and exchange rate adjustments are generally supporting improved fiscal positions compared to 2015, but have not prevented erosion of sovereign credit worthiness,” Fitch said.

Kuwait at $45 per barrel has a low beak even  because of its high per capita hydrocarbon production and more recently its “large estimated investment income” from its sovereign wealth fund, Fitch said.

Brent crude has averaged about $55 per barrel this year. It traded about $54.96 per barrel on Thursday.

The Nigerian Liquefied Natural Gas Limited (NLNG) has begun talks with potential buyers on new contract of gas supplies from its first three production unit at its Liquefied Natural Gas terminal, quoted a senior official of the company.

Contracts for gas supplies of Train 1, 2 and 3 which together produce an output of nine million tonnes of LNG are being discussed,  said the official who remained anonymous while attending the Gas-tech conference in Chiba, outside Tokyo

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