Editorial
Nigeria: Cushioning Effects Of M’East Crisis
The ongoing crisis in the Middle East between the United States and Israel on one hand and Iran on the other has once again unsettled global stability, with escalating tensions disrupting oil production routes and threatening key supply chains. Conflicts involving major oil-producing nations and strategic waterways have created uncertainty in the international energy market. As history has repeatedly shown, instability in this region often sends shockwaves across the global economy, particularly in energy-dependent countries.
One of the most immediate consequences of this war has been a sharp rise in global crude oil prices. Brent Crude has surged between $105 and $110 per barrel in recent weeks, reflecting fears of supply shortages. This increase has translated into higher fuel costs worldwide, placing immense pressure on both developed and developing economies.
Nigeria, despite being a major crude oil producer, has not been spared. The country’s heavy reliance on imported refined petroleum products has meant that global price increases directly affect domestic fuel costs. Rather than benefiting fully from higher crude prices, Nigerians are grappling with the paradox of rising oil wealth alongside worsening living conditions.
The impact on the cost of living has been severe. Transportation fares across major cities have increased by over 50 per cent, while food inflation has climbed above 30 per cent, according to recent data from the National Bureau of Statistics (NBS). The ripple effect of higher fuel prices has touched every sector, from agriculture to manufacturing, making basic goods increasingly unaffordable for ordinary citizens.
In response to this growing hardship, the Nigeria Labour Congress (NLC) has demanded urgent intervention from the Federal Government to cushion the effects of the recent spike in petrol prices occasioned by the Middle East crisis. The call reflects widespread frustration among workers and the broader population.
The NLC made this demand in a statement titled “Save Nigerians From This Shock: An Urgent Relief Has Become Necessary,” signed by its President, Joe Ajaero. The statement underscores the urgency of the situation and highlights the growing disconnect between government policy and the lived realities of citizens.
We strongly support the NLC’s clarion call and urge the administration of President Bola Tinubu to take immediate and decisive steps to cushion the harsh effects of the crisis on Nigerians. Leadership at this critical moment requires bold, people-centred policies that prioritise national welfare over market orthodoxy.
One such step is the reintroduction of a fuel subsidy, funded by the gains from the current surge in global crude oil prices. The government could choose to subsidise either the finished petroleum products or the crude supplied to local refiners. Providing crude at reduced rates to Aliko Dangote refinery would significantly lower the final pump price for consumers.
This brings into focus the role of Dangote, whose refinery has the potential to transform Nigeria’s energy landscape. Dangote has stated that the Federal Government currently supplies only 30 per cent of the crude required for his refinery, compelling him to import the remaining 70 per cent. For a country that produces millions of barrels daily, this situation is both inefficient and unacceptable.
Beyond fuel pricing, there is a pressing need for direct support to workers. A cost-of-living allowance, a wage award, and targeted tax relief measures would provide immediate relief. At the same time, the government must take concrete steps to revive Nigeria’s dormant public refineries, which have long been a drain on public resources without delivering value.
The sharp rise in fuel prices, now selling at approximately N1,310 to N1,400 per litre in many parts of the country, has deepened economic hardship. For millions of Nigerians, daily survival has become a struggle. Without urgent intervention, the nation risks severe social unrest, as frustration continues to mount among the populace.
It is deeply troubling that the Federal Government appears to have left Nigerians at the mercy of volatile global oil prices triggered by the Middle East imbroglio. This situation has exposed the fragility of the downstream petroleum sector and highlighted the failure to build resilience despite decades of oil wealth.
As long as Nigeria remains tied to a market-driven pricing structure dictated by global fluctuations and continues to neglect its domestic refining capacity, it will remain vulnerable to external shocks. International conflicts and speculative market forces will continue to dictate the economic fate of Nigerian households.
Nigerian workers are being pauperised and subjected to immense suffering. They are not mere statistics; they are the engine of the nation’s economy. When that engine overheats, the entire system risks collapse. Ignoring their plight is not just unjust—it is economically reckless.
Finally, the estimated N30 trillion oil windfall expected from the current crisis must not be squandered as in the past. These resources should be transparently managed and invested in social protection programmes, infrastructure, and economic stabilisation. In addition, Nigeria must develop robust crude storage systems, as seen in other countries, to cushion future shocks. Failure to properly manage the energy situation could further accelerate inflation, compounding the already substantial burden on citizens.