Economy
Nigeria’s Economy Strong Enough to Absorb Oil Market Shocks—Edun
By Adedapo Adesanya
The federal government has begun assessing the potential economic implications of the escalating geopolitical tensions in the Middle East and adjusting policies to shield Nigeria from possible disruptions.
This was disclosed by the Minister of Finance, Mr Wale Edun, as the Economic Management Team (EMT) convened to evaluate the risks posed by the US-Israel-Iran standoff to global energy routes, such as the Strait of Hormuz.
He said Nigeria’s robust 4.07 per cent real GDP growth in Q4 2025 positions the country to weather looming oil market shocks from Iran tensions.
Mr Edun, who chairs the EMT, in a statement issued on Tuesday by the Assistant Director for Information and Public Relations in the ministry, Uloma Amadi, said the government was closely monitoring developments and remained committed to safeguarding Nigeria’s economic stability.
The EMT moved to review the potential impact of the unfolding crisis on the Nigerian economy.
Mr Edun also chaired a Naira-for-Crude policy coordination meeting to evaluate developments in the global energy market and their possible domestic implications.
The government noted that the situation remained fluid, with global markets already showing signs of uncertainty amid concerns about potential disruptions to critical energy supply routes, particularly the Strait of Hormuz.
Such disruptions, it said, could lead to volatility in crude oil prices and financial markets worldwide.
Given Nigeria’s integration into global commodity and financial markets, the government identified three major channels through which the crisis could affect the domestic economy.
These include crude oil and gas prices, capital flows and financial market conditions, as well as global logistics and supply costs.
The statement noted that volatility in global energy markets was already pushing up the prices of key commodities, with possible implications for domestic fuel, diesel, cooking gas, and fertiliser costs.
It added that heightened geopolitical risks could also lead to a shift by global investors toward safe-haven assets, potentially affecting capital inflows into emerging markets, including Nigeria.
In addition, disruptions to major shipping and energy supply routes could increase international freight and logistics costs, thereby exerting upward pressure on domestic prices.
The Minister of Finance noted that, beyond these immediate effects, sustained instability in the region could lead to higher prices for goods and services, further intensifying inflationary pressures and the cost of living.
During the EMT meeting, ministers provided sector-specific updates on the evolving situation, with discussions focusing on the likely scale of impact on Nigeria depending on the duration and intensity of the conflict.
Particular attention was placed on how developments in the global oil market could influence Nigeria’s fiscal outlook and external reserves.
The government said the Economic Management Team is closely monitoring key macroeconomic indicators, including global crude oil prices, exchange rate developments, and their potential impact on domestic prices.
It is also tracking capital flows, financial market conditions and broader implications for Nigeria’s fiscal position.
Despite global uncertainty, the Federal Government said Nigeria is entering the period from a position of strengthened economic fundamentals.
It cited recent economic data showing that the country recorded a real Gross Domestic Product growth of 4.07 per cent in the fourth quarter of 2025, one of the strongest quarterly performances in more than a decade.
According to the statement, the growth reflects the impact of ongoing economic reforms and improved macroeconomic coordination.
The government said it remains committed to protecting these gains and ensuring that recent progress in economic stabilisation and revenue mobilisation is not undermined by external shocks.
To achieve this, the Economic Management Team is maintaining close coordination across fiscal, monetary and energy policy institutions.
Policy options are also being kept under continuous review to mitigate potential volatility and protect households and businesses from the possible spillover effects of the global crisis.
Mr Edun emphasised that careful policy calibration would remain central to the government’s response to evolving global developments.
By Aduragbemi Omiyale
The Stanbic IBTC Bank Nigeria Purchasing Managers’ Index (PMI) for the Nigerian private sector in July 2026 contracted to 52.5 points from 53.4 points in June 2026, a statement made available to Business Post has shown.
This occurred despite the business environment sustaining its growth last month, with an increase in new orders experienced, as inflationary pressures softened, and output and employment modestly rising.
The Head of Equity Research West Africa at Stanbic IBTC Bank, Mr Muyiwa Oni, said the PMI indicated that the private sector recorded its slowest since March 2026, as businesses also increased their input purchasing activity to keep up with current demand requirements and prepare for future workloads.
“Nigerian businesses reported improved customer demand in July while better pricing and new product launches also helped them to capture new orders arising from the increase in demand. These factors helped to keep the private sector activity in an expansionary territory, although this moderated when compared to June,” he was quoted as saying.
It was stated that while input costs increased at their slowest pace in five months, panellists reported higher costs for fuel and raw materials. Selling prices also softened in line with the picture for input costs in July.
Headline inflation eased slightly to 15.91 per cent y/y in June from 15.93 per cent y/y in May, snapping three consecutive months of price increases.
Although July inflation is likely to be higher m/m, it is expected to print lower, likely at 15.72 per cent y/y, primarily driven by favourable base effects from the corresponding period of last year, because there are no expectations of the magnitude of m/m inflation witnessed in July 2025 (1.99 per cent) to materialise this year.
“We retain our 2026 growth forecasts at 4.1 per cent as we see the oil sector growing by 3.45 per cent y/y in 2026, from 8.50 per cent y/y in 2025, while the non-oil sector is likely to grow by 4.11 per cent y/y, from 3.71 per cent y/y in 2025.
“The risks to our outlook include country-wide insecurity which may constrain food production, exchange rate pressures resurfacing, extreme-weather related conditions and higher fertiliser prices impacting crop yield, and a volatile global environment which may affect sentiment and constrain capital flows,” Mr Oni noted.
By Adedapo Adesanya
Sahara Upstream, a Nigeria-focused crude producer, has deployed a new 380,000-barrel tanker to boost exports from the OML 18 block as part of a wider push by domestic operators to invest in infrastructure and lift output and exports for Africa’s biggest oil producer.
The MT D Adesanya, which can hold more than 62,000 cubic metres of crude, will operate alongside the MT D Bayero, receiving crude from shuttle vessels at Bonny Anchorage, one of Nigeria’s main crude export hubs, before transferring it to the FSO Cawthorne storage facility.
Sahara said the tanker would help cut turnaround times, currently about 30 to 48 hours, and support a planned 50 per cent increase in exports from the block’s current level of about 950,000 barrels per month.
The block currently produces about 36,000 barrels per day, according to data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), with Sahara targeting output of 60,000 barrels per day.
OML 18 is one of the Niger Delta’s oldest producing assets. It began production in 1970 and contains an estimated 1.5 billion barrels of oil equivalent in reserves.
Shell, Total and Eni sold their combined interests to Eroton in 2015 as part of a broader shift toward domestic ownership in Nigeria’s upstream sector.
This development comes as Sahara Upstream is deepening its exploration and production footprint through Asharami Energy Limited (AEL), its upstream E&P business, which says it is targeting 350,000 barrels of oil per day by 2030 through its subsidiary, Enageed Resources Limited (ERL).
The growth target comes as AEL also marks a major safety milestone, achieving 6 million Lost Time Injury (LTI)-free man-hours in its OML-148 operations — reinforcing the company’s commitment to operational excellence and safety leadership.
According to Asharami Energy, the milestone reflects its ability to execute complex operations safely, in line with Sahara’s Beyond XXX vision, which builds on the group’s 30-year legacy of responsible enterprise while marking its next chapter of impact, innovation, and sustainable growth.
The developments position Sahara Upstream and its subsidiaries among the domestic operators driving increased investment in Nigeria’s oil and gas infrastructure, as the group works to scale up production and exports for Africa’s biggest oil producer.
By Aduragbemi Omiyale
One of the leading energy firms in Nigeria, Aradel Holdings Plc, has expressed its desire to optimise its enlarged portfolio and improve operational efficiency in the second half of 2026.
The company is planning to build on the success it recorded in the first half of the year, where it grew its revenue by 577 per cent to N2.5 trillion from N368.1 billion in H1 2025.
The significant rise in earnings was driven by higher production volumes together with stronger realised crude oil and gas prices, with the average at $90.4/bbl and $2.08/mmscf, respectively.
In the period under review, the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) increased by 688 per cent to N1.4 trillion from N176.4 billion in the corresponding period of last year, while the operating profit surged by 789 per cent to N1.1 trillion from N118.6 billion due to higher revenue and crude handling income at N149.8 billion, partly offset by underlift cost and general and administrative costs.
The net cash generated from operations was N975.6 billion between January and June 2026 versus N140.8 billion in the same period of 2025, reflecting the cash generation of the enlarged organisation.
The net debt contracted by 70 per cent on a year-to-date basis to N46.5 billion from N475.1 billion as of December 31, 2025.
Aradel, in the period under consideration, improved its post-tax profit by 30 per cent to N191.0 billion from N146.4 billion, a development that impressed its chief executive, Mr Adegbite Falade, who said, “A firmer price environment supported performance, generating net cash from operating activities of N975.6 billion and a closing cash balance of N1.7 trillion.”
“Our enlarged portfolio provides more opportunities to generate stronger cash flow and returns for shareholders and unlocking that potential is our main focus.
“We reaffirm our full year production guidance of 110 – 140 kboepd and remain committed to operating responsibly in a changing energy landscape and to delivering lasting value for our stakeholders,” he stated.
