Falling oil prices, serious challenge to Nigeria –Campbell

former United States of America
Ambassador to Nigeria, John Campbell
A former United States ambassador to Nigeria,
John Campbell, has raised the alarm that
current situations in Nigeria, especially falling oil
prices, are making it difficult for the country to
avoid disintegration.
He stated that apart from the Boko Haram
insurgency plaguing the country, the falling oil
prices posed a new challenge to the Federal
Government.
Campbell also noted that any attempt by the
President Goodluck Jonathan administration to
pursue policies of austerity could lead to a
protest similar to that of the oil subsidy
removal in 2012.
The Ralph Bunche Senior Fellow for Africa Policy
Studies writing on the Council on Foreign
Relations website said, “National elections are
scheduled for February 14, 2015. Elections are
the occasion and the venue for competition,
often violent, among Nigeria’s fractured political
elite. In the past, abundant oil money provided
a means to resolve numerous conflicts, to
literally ‘grease the skids.’ Now, there is less
money available.
“Nigeria has benefited from an oil boom since
the end of military rule in 1999. Prices rose
from $10 per barrel that year to $140 per
barrel in 2008. As late as June 2014, they
remained above $100. However, since June, oil
prices have fallen by more than 30 per cent. It
is unlikely that they have reached bottom.”
According to him, the FG may be reluctant to
approach international financial institutions for
assistance because of the likely requirements
those institutions will impose on it.
“The confluence of declining oil prices and
government revenue, a failing effort against
Boko Haram, and contentious national elections
in two months is making it harder for Nigeria to
pull back from the brink,” he said.
The former US ambassador to Nigeria stated
further that a major cut in oil production by the
Organisation of Petroleum Exporting Countries,
led by Saudi Arabia could cause oil prices to
recover to the $100 per barrel level.
Campbell also noted that Nigeria’ dependency
on oil was “now stirring serious concern
throughout the country’s political class.”
“Among other things, a whole array of
government expenditures associated with
petroleum play a major role in sustaining the
cooperating and competing patronage networks
that run Nigeria. Absent this political lubricant,
the country’s already unstable political situation
promises to get worse just two months ahead
of national elections,” he said...