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Kachikwu Clarifies Nigeria’s $100bn Loss to Militancy in Niger Delta

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Emmanuel Ibe Kachikwu
  • Kachikwu Clarifies Nigeria’s $100bn Loss to Militancy in Niger Delta

The Minister of State for Petroleum, Dr. Ibe Kachikwu, has clarified the $50-$100 billion said to have been lost to the attacks of oil and gas infrastructure by the Niger Delta militants.

In his recent monthly podcast, the minister was quoted as saying that Nigeria lost $50-$100 billion in oil revenue at the peak of the militant attacks on oil and gas facilities in the Niger Delta, which slashed oil production from 2.2 million barrels per day to one million barrels per day last year.

But in a statement yesterday, the Technical Assistant (Media) to the minister, Uche Ozurumba Adighibe, made a clarification on the $50 – $100 billion unearned income lost to militancy, which was mentioned by the minister.

Adighibe, who quoted the minister as having said in the podcast that “as at 2016 on the average and looking at it historically that we (Nigeria) was losing $50 – $100 billion as result of the disruption,” said the amount covers a period of 10 years and not 2016 only.

On the amount lost in 2016, Adighibe pointed out that the Nigeria’s oil and gas industry lost over $7 billion to militancy from January to October 2016.

“Please note the word ‘historically’. Over the last decade spanning through various administrations, the oil industry in Nigeria has suffered critical disruptions to operations resulting in the unearned incomes amounting to $50 – $100 billion due to militancy activities and vandalism. This can be verified through the records provided by the Nigerian National Petroleum Corporation (NNPC) during the 2016 Fiscal Liquidity Assessment Committee Retreat which showed that the industry lost over $7 billion due to activities of militancy groups and oil pipeline vandals from January 2016 –October 2016,” Adighibe further clarified.

The minister’s technical assistant added that the amount mentioned as unearned income due to militancy activities as stated in the podcast covers the entire industry which includes the international oil companies (IOCs), independent producers as well the Nigerian National Petroleum Corporation (NNPC).

To tackle the scourge the minister, who spoke on “Oil Sector Militancy Challenges…Roadmap to Closure,”also unveiled a 20-point agenda aimed at instituting permanent peace in the oil-producing region.

According to him, the Niger Delta crisis, coupled with the 45 per cent drop in oil production, worsened the financial challenges of the President Muhammadu Buhari administration.

Kachikwu said the crisis resulted in attacks on oil and gas facilities and the sub-optimal performance of the refineries, stressing that Nigeria was unable to meet its international obligations as a result of the militancy.
He said despite all efforts made by successive administrations to tackle the militancy in the Niger Delta, a permanent solution was never found.

The minister also stated that the present administration has also made efforts to end the crisis by launching a seven-point roadmap, engaging the oil-producing communities and sustaining the Amnesty Programme for the repentant militants.

Kachikwu added that President Buhari’s efforts to sustain the programme were being hampered by declining oil revenue, as the present administration only gets 55 per cent of the revenue that was available to previous administrations.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Crude Oil

Global Oil Drops as Coronavirus Infections Rises in India and Other Nations

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Crude oil

Oil prices declined on Monday during the Asian trading session amid rising concerns that the surge in coronavirus in India and other nations could force regulators to enforce stronger measures at curbing its spread and eventually affect economic activity and drag on demand for commodities like crude oil.

Brent crude oil, against which Nigerian oil is priced, declined by 22 cents or 0.33 percent to $66.55 per barrel at 8:19 am Nigerian time on Monday, following a 6 percent surge last week.

The US West Texas Intermediate (WTI) declined by 18 cents or 0.29 percent to $62.95 per barrel, after it gained 6.4 percent last week.

The decline was after India reported 261,500 new coronavirus infections on Sunday, taking the country’s total cases to almost 14.8 million, second to only the United States that has reported over 31 million coronavirus infections.

“With … a resurgence of virus cases in India and Japan, topside ambitions continue to run into walls of profit-taking,” said Stephen Innes, chief market strategist at Axi.

Businesses in Japan believed the world’s third-largest economy will experience a fourth round of coronavirus infections, with many bracing for an additional slow down in economic activity.

While Japan has had fewer COVID-19 cases when compared with other major economies, concerns about a new wave of infections are fast rising, according to responses in Reuters poll.

On Tuesday, April 20, 2020, Hong Kong will suspend all from India, Pakistan and the Philippines because of imported coronavirus infections, authorities stated in a statement released on Sunday.

India’s COVID-19 death rose by a record 1,501 to hit 177,150.

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Global Markets Near Record Peaks and Will Get Stronger: deVere CEO

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Stocks

As the FTSE 100 hits 7,000 points for the first time since the Covid pandemic, global stock markets are poised to “get even stronger”, says the CEO of one of the world’s largest independent financial advisory and fintech organisations.

The observation from Nigel Green, the chief executive and founder of deVere Group, comes as London’s index jumped over the important threshold in early trading in London, gaining over 0.5% to 7024 points.

Mr Green notes: “London’s blue-chip index is up 40% since the worst lows of the pandemic.

“This landmark moment represents the wider optimistic sentiment gripping global markets which are near record peaks.

“We can expect global stock markets to get even stronger as investors look to seize the opportunities from economies reopening.

“They are looking towards economies rebounding in a post-pandemic era due to the monetary and fiscal stimulus, pent-up cash and demand, and strong corporate earnings.

“The current ultra-low interest rate environment and the under-performance of bonds will also act as a catalyst for stock markets.”

However, the CEO’s bullish comments also come with a warning.

“I would urge investors to proceed with caution as there are some headwinds on the horizon, including relations between the U.S. and China, the world’s two largest economies, which could be coming to a tipping point in coming weeks.

“As such, in order to capitalise on the opportunities and mitigate risks, investors must ensure proper portfolio diversification.”

Mr Green concludes: “A variety of factors are going to drive global stock markets. Investors will not want to miss out and should work with a good fund manager to judiciously top-up their portfolios.”

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Refinitiv Expands Economic Data Coverage Across Africa

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Building on its commitment to drive positive change through its data and insights, Refinitiv today announced the expansion of its economic data coverage of Africa. The new data set allows investment managers, central bankers, economists, and research teams to use Refinitiv Datasteam analytical data for detailed exploration of economic relationships and investment opportunities among data series covering the African continent.

Securing reliable, detailed, timely, locally sourced content has not been easy for economists who have in the past had to use international sources which often can take many months to update and opportunities to monitor the market can be missed. Because Africa is a diverse continent, economists and strategists need more timely access to country-specific data via national sources to create tailored business, policy, trading and investment strategies to meet specific goals.

Africa continues to develop critical infrastructure, telecommunications, digital technology and access to financial services for its 1.3bn people. The World Bank estimates that over 50% of African inhabitants will be under 25 by 2050. This presents substantial opportunities for investors who can spot important trends and make informed decisions based on robust and timely economic data.

Stuart Brown, Group Head of Enterprise Data Solutions, Refinitiv, said: “Africa’s growing, dynamic and fast evolving economies makes it a focal point for financial markets today and in the coming decades.  As part of LSEG’s commitment to empowering the global markets with accurate and timely data, we are excited about making these unique datasets available via the Refinitiv Data Platform. Our economic data coverage of Africa will provide our customers with deeper and broader inputs for macroeconomic analyses and enable more effective investment strategies and economic research.”

Refinitiv Africa economic data coverage:

  • Africa economics content comprises around 500,000 nationally sourced time series data covering 54 African nations
  • Content is sourced from national statistical offices, central banks and other key national institutions
  • The full breadth of economics categories in Datastream including national accounts, money and finance, prices, surveys, labor market, consumer, industry, government and external sectors
  • International sources including OECD, World Bank, IMF, African Development Bank, Oxford Economics & more provide comparable data & forecasts across the continent

Refinitiv® Datastream® has global macroeconomics coverage to analyze virtually any macro environment, and better understand economic cycles to uncover trends and forecast market conditions. With over 14.2 million economic times series map trends, customers can validate ideas and identify opportunities using Refinitiv Datastream. Access its powerful charting tools, 9,000 pre-built chart templates and chart studies for commonly used valuation, performance, and technical and fundamental analysis.

 Refinitiv continually grows available data – the China expansion in 2019 covered a unique combination of economic and financial indicators. Refinitiv plans to expand Southeast Asia covering Thailand, Vietnam, Philippines and Malaysia with delivery expected in 2021. This ensures that Refinitiv will have much needed emerging market economic content.

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