By Ojone Enejoh (Energy Correspondent)
The nation's Petroleum financed Nigeria's transformation, but it also became one of the principal reasons that transformation remained incomplete.
The creation of the Nigerian National Petroleum Corporation (NNPC), the establishment of the Organisation of Petroleum Exporting Countries (OPEC) membership, the successive petroleum laws, local-content policies, the Petroleum Industry Act (PIA) and the repeated refinery rehabilitation programmes, represent decades of attempts to make the sector work better. Yet the country spent years exporting crude while importing refined petroleum products. That contradiction became one of the most visible symbols of Nigerian economic dysfunction.
The Petroleum Industry Act of 2021 attempted to establish a more comprehensive regulatory and commercial framework. Under President Bola Ahmed Tinubu administration, the removal of petrol subsidy and foreign exchange reforms fundamentally changed the petroleum and macroeconomic landscape. The government says subsidy payments had become fiscally unsustainable, while the World Bank and IMF recognise that reforms have improved fiscal and external positions but imposed severe short-term pressure on households.
The long-term question is whether Nigeria can finally convert petroleum into a bridge to a diversified economy rather than an excuse for remaining dependent on crude. But that however requires transparent oil accounting;
competitive licensing; lower production losses; reduced crude theft; better regulation; gas development; domestic refining; petrochemicals; local manufacturing; and disciplined investment of petroleum revenues. The oil sector should increasingly finance the transition away from oil dependence. NNL.
