The Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed, has attributed the recent slump in global crude oil prices to the renewed wave of aggressive tariff policies rolled out by former U.S. President Donald Trump, now back in office following his re-election.
Speaking at a press briefing in the State House, Abuja, on Tuesday, Ahmed warned that Trump’s reintroduced protectionist trade policies—particularly new tariffs targeting key global economies—are fuelling uncertainty in international oil markets, driving volatility, and dampening investor confidence.
“The global oil market today is reacting sharply to the erratic tariffing policies of the new American government,” Ahmed said.
“These tariffs are not only aimed at China but are sweeping across multiple countries and regions. They are unsettling the balance of demand and supply, particularly in the energy sector.”
According to the NMDPRA boss, the unpredictability surrounding the U.S. government’s economic direction is forcing investors and traders into short-term, high-risk decisions.
“The problem is not just the tariffs,” Ahmed explained.
“It’s the inconsistency. One day, a major policy is announced; the next, it is reversed or escalated. This kind of back-and-forth has made it almost impossible for investors to make long-term plans.”
Ahmed said that many oil traders are now operating on what he called a “daily strategy,” buying and selling within 24 hours due to fears of sudden policy swings from Washington.
“We’re seeing traders close out by the end of each day because they’re unsure what tomorrow’s news from the U.S. will bring,” he said. “This isn’t healthy for the global market.”
Ahmed also raised concerns that the Trump administration’s energy posture appears to favour lower crude oil prices—possibly below the $50-per-barrel mark—through a combination of aggressive domestic drilling and strategic manipulation of global supply lines.
“There is clearly a policy direction from the U.S. President to push crude oil prices down,” he noted.
“Part of that includes encouraging massive domestic exploration and placing pressure on international suppliers through tariffs and trade negotiations.”
This drive, Ahmed warned, could have ripple effects for oil-dependent economies like Nigeria, which rely heavily on crude exports for revenue and foreign exchange inflows.
Nigeria, which exports nearly 90 per cent of its crude oil, is particularly vulnerable to price fluctuations driven by external shocks.
The 2025 budget was benchmarked on a projected oil price of $74 per barrel, meaning the country could face revenue shortfalls if prices drop significantly below that mark.
Ahmed’s remarks come at a time when Nigerian authorities are already grappling with forex pressures, slow subsidy reforms, and efforts to attract investment under the Petroleum Industry Act (PIA).
“The volatility we’re seeing today is not just market-driven—it’s policy-driven, coming from one of the world’s most influential economies,” Ahmed warned.
“And for countries like Nigeria, that’s a serious concern.”
While Ahmed acknowledged that the oil market is naturally dynamic—affected by geopolitical tensions, regional conflicts, and OPEC+ decisions—he called for greater coordination among global powers to avoid actions that may destabilise energy markets.
This comes as Nigeria has recorded a significant decline in the importation of Premium Motor Spirit (PMS), commonly known as petrol, as local refineries begin to play a more active role in meeting domestic fuel demand.
According to the NMDPRA CEO, the country’s petrol imports dropped from 44.6 million litres per day in August 2024 to just 14.7 million litres per day by 13 April 2025—a reduction of nearly 30 million litres daily.
The agency attributed the sharp decline to increased production from domestic refineries, particularly the gradual restart of the Port Harcourt Refining Company and contributions from modular refinery operators.
Ahmed described the development as a positive shift towards energy self-sufficiency.
“After contributing virtually nothing in August, local refineries ramped up production to 26.2 million litres per day by early April,” Ahmed said.
“This marks a significant jump from just 3.4 million litres recorded in September—the first month with measurable output.”
He noted that local supply rose by a remarkable 670 per cent over the period under review, driven primarily by the resumption of operations at the Port Harcourt refinery and increased activity among modular refineries.
Despite the improvement, Ahmed pointed out that Nigeria’s total daily PMS supply surpassed the government’s benchmark consumption target of 50 million litres only twice in the past eight months—56 million litres in November 2024 and 52.3 million litres in February 2025.
“In March, supply slightly dipped below the target at 51.5 million litres per day, and in the first half of April, it further dropped to 40.9 million litres,” he added.
Ahmed also emphasised that the NMDPRA only issues import licences based on actual supply needs, noting that the Authority remains committed to balancing domestic output with strategic imports to maintain market stability.
The significant drop in petrol imports is seen as a critical step towards reducing Nigeria’s dependence on foreign fuel, strengthening energy security, and conserving scarce foreign exchange.
He further explained: “Obviously, we see a downward trajectory, like I said earlier, in terms of product pricing and crude oil pricing. So we are happy, of course, as consumers of the derivatives of pricing, that the price is coming low.
“But when we look globally as a nation, it’s not good for our economy, because our revenue inflow is also impacted. If the crude oil price, like what happened the previous week on Friday, dropped in one day from about $74–$73 a barrel to $60, you can see that in terms of our production of crude oil, our revenue is impacted severely.
“So you can look at the revenue inflow into the country, compounded with the problem of vandalism and illegal bunkering and the low production. Recently, we just had a report from OPEC that Nigerian production has come down to about 1.4 million barrels a day. And then, if we lose the price by $10, you can see the negative impact on our economy, our national reserves, as well as the strength of our naira.
“But again, when you look at the products market, we are happy to say, oh, the price is coming down.
“So this volatility will continue, because as recent as yesterday, when President Trump again exempted some sectors from tariffs, particularly to China, like in terms of vehicular tariffs, you saw the market again start to go up. So this is how it will continue to show. Just to give you a general perspective of the oil industry.”
He said that six licensed private and four public refineries currently produce 1.12 million barrels per day.
Six licensed private plants account for 679,500 bpd of the total.
The Dangote single‑train complex refines 650,000 bpd.
Other modular sites include Aradel (11,000 bpd), OPAC (10,000 bpd), Waltersmith (5,000 bpd), Duport Midstream Limited (2,500 bpd), and Edo Refining and Petrochemicals Company Limited (1,000 bpd).
State‑owned facilities add 445,000 bpd.
The refurbished Port Harcourt complex (150,000 bpd), Warri (125,000 bpd), Kaduna (110,000 bpd), and the old Port Harcourt unit (60,000 bpd) make up the Nigerian National Petroleum Company Limited’s share.
The NMDPRA said it has issued 47 Licences to Establish covering 1.75 million bpd and 30 Licences to Construct for 1.23 million bpd.
Only four plants currently hold Licences to Operate, and these together have a steady output of 27,000 bpd.
Ahmed said five LTC projects with a combined capacity of 689,500 bpd are at the commissioning or construction stage, including Dangote with 650,000 bpd. Smaller builds include AIPCC Energy’s 30,000 bpd plant and Waltersmith’s 5,000 bpd second train.
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