As Nigeria ramps up efforts to implement its N54.9 trillion 2025 budget, experts have raised concerns over the potential impact of U.S. President Donald Trump’s energy policies. Trump’s push for increased oil production through his “Drill Baby Drill” agenda is seen as a potential threat to Nigeria’s $75 per barrel oil price target, which is central to the country’s budget assumptions.
The U.S. is the world’s largest oil producer, and with a significant increase in production, global oil supply could exceed demand, leading to falling prices. Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), warned that this could result in weaker oil prices, adversely affecting Nigeria’s government revenue, foreign exchange earnings, and inflation rates.
The potential effects of Trump’s policies include high inflation, reduced Diaspora remittances, and weakened fiscal projections for Nigeria. Yusuf emphasized that if oil prices drop below the $75 per barrel benchmark, the Nigerian government may struggle with budget deficits and inflationary pressures.
Analysts also highlighted that Trump’s trade policies and increased fossil fuel investment could disrupt global supply chains, further complicating Nigeria’s economic outlook. Clifford Egbomeade, an analyst, echoed concerns that a significant drop in oil prices could undermine the nation’s foreign exchange reserves and drive up inflation.
While some experts, including NACCIMA’s Dele Oye and petroleum economist Prof. Wumi Iledare, downplay the potential effects, the consensus remains that Nigeria must accelerate economic diversification to reduce its reliance on oil. Economic experts argue that this approach is essential to insulate the country from volatile global oil markets and trade tensions.
Ultimately, experts call for a focus on self-reliance through diversification, noting that oil price fluctuations should not be the primary benchmark for Nigeria’s economy.
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