Index to Nigerian Newspapers

Pundits and economists alike are waiting to see which side will prevail 10 years after protests against petrol subsidy removal empowered the present ruling party. Despite fears of repercussions, some economists and stakeholders agree that removal of the subsidy is a necessary step towards long-needed reform. However, the feasibility of the plans to give transportation grants to poor Nigerians has raised doubts on the source of funds and impact on the volume of money in circulation, as well as transparency and accountability issues. President Muhammadu Buhari's administration has decided to remove the subsidy this year and damn the consequences to free up resources needed to run the economy. A panel chaired by Vice President Yemi Osinbajo will meet with the Nigeria Labour Congress (NLC) and other stakeholders to consider the proposed N5,000 transport palliative and other options aimed at ameliorating the effects of the planned subsidy removal on Nigerians. The options remain hard as labour unions are already up in arms to protest if the decision on subsidy removal is taken.

The Federal Government is exploring new measures to raise revenue through tax reforms, but there are concerns that no amount of tax revenue will be enough to finance the magnitude of fiscal indiscipline by the executives. Debt has become the default option for the government in addressing gaps in its financing, raising concerns about repayment capacity and abuse by the executive. Nigeria's total debt stock rose from N32.9 trillion as of December 2020 to N39.6 trillion in November 2021. Despite higher revenue from rising oil prices, production challenges have put the country on the edge, with production averaging 1.3 million barrels per day. With over N7 trillion in fiscal deficit, the country may be heading towards double-digit deficit financing in the 2022 financial year. The Senate has developed a strategy to engage with revenue-generating agencies on how to make them achieve their targets and generate more revenues in 2022 to narrow the margins. The 2022 Budget is predicated on significant borrowing, making the country caught between the devil and the deep blue sea. To fund infrastructure, the country has to borrow and resort to other sources of funding. To improve on the revenue to GDP ratio, the country needs to generate more revenues.

The Organisation of Petroleum Exporting Countries (OPEC) and its allies announced that they will return 400,000 barrels per day to the global oil market in February. Nigeria is expected to pump 1.7 million barrels a day, but lingering challenges may undermine the country's capacity. The deadline for compensation over previous overproduction will be extended until June. The alliance is scheduled to meet on February 2 to set production levels for March. OPEC Secretary-General Sanusi Barkindo forecasts world oil demand to grow 5.7 mb/d in 2021 and 4.2 mb/d in 2022. Non-OPEC liquids supply growth in 2021 is forecast at 0.7 mb/d y-o-y to average 63.7 mb/d. OPEC crude oil production increased by 275 tb/d in November m-o-m to average 27.72 mb/d. Saudi energy minister Prince Abdulaziz bin Salman closed the December meeting and declared the new meeting open.

The Organization of Petroleum Exporting Countries (OPEC) Monthly Oil Market Report (MOMR) showed that Nigeria's production in December was lower than expected, with the country's rig count dropping further to six from seven. Despite a projected 1.86 million barrels daily oil production in the 2021 budget, Nigeria recorded a deficit of almost 200 million barrels in the first 11 months of 2021 due to production challenges. OPEC has left unchanged its world oil demand growth projections for 2022, signalling the potential impact of the Covid-19 Omicron variant and uncertainty over global inflation levels, supply bottlenecks, trade disputes and appetite for transport fuels. It also kept its non-OPEC liquids output growth forecast unchanged at 3.02mn b/d.