Experts have raised concerns that President Donald Trump’s aggressive energy policy could destabilize Nigeria’s 2025 budget, which is pegged on a $75 per barrel oil price. Trump's 'Drill Baby Drill' initiative, aimed at boosting U.S. oil production, could oversupply the global market and depress prices.
Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), warned that a fall in oil prices could reduce Nigeria's revenue, increase fiscal deficits, and weaken the naira. He also cautioned that Trump’s withdrawal from the Paris Climate Accord may spur fossil fuel investments, further saturating the oil market.
Additionally, Clifford Egbomeade, a financial analyst, highlighted that lower oil prices would erode Nigeria’s foreign reserves, accelerate naira depreciation, and fuel inflation. He emphasized the urgent need for Nigeria to diversify its economy and reduce its reliance on crude oil.
However, some experts, including Prof. Wumi Iledare, argued that Trump’s policies are unlikely to crash oil prices, citing U.S. production limitations and market dynamics. Similarly, David Adonri from Highcap Securities noted that even with increased U.S. output, OPEC and other producers would act to protect their interests.
The debate underscores the importance of economic diversification to shield Nigeria from external shocks, with experts urging a shift toward boosting local production in agriculture, manufacturing, and services.
