22nd April, 2020
By Kazeem Ugbodaga
Former Vice President, Atiku Abubakar has proffered solution on how Nigeria can survive the impact of global oil collapse on the nation’s economy.
Atiku, in a statement on Wednesday said the time was right for Nigeria to build a strategic crude oil reserve, with massive storage capacity that could hold at least a month’s worth of its OPEC production capacity.
He said the global oil market continued to suffer from the vagaries of the coronavirus pandemic, as prices continued to crash due to the sudden, massive and unexpected drop in worldwide demand for crude oil.
According to him, the features market for commodities was a turbulent one, due to unforeseen hazards that come and go and that “Today, it is COVID19; tomorrow, it will be something else.”
“It is time for Nigeria to protect her economy from being tossed to and fro by circumstances beyond our control. We must assert our sovereignty, by exerting more influence over the global trade in crude oil, and other features.
“I believe that the time is right for Nigeria to build a strategic crude oil reserve, with massive storage capacity that can hold at least a month’s worth of our OPEC production capacity.
“If we build such an infrastructure, we will not have to sell our crude at a production loss. We will be in a position to stockpile the product in our reserve until such a time as prices improve,” he said.
The former Vice President said other nations took such measures to protect their economy and that North American and European nations had such internal controls to protect almost every sector of their economy – from agriculture, automobile, and even intellectual property., adding that Nigeria could not be left behind as it must be in business for the best interest of the economy.
“I would also strongly recommend that we discuss with our partners in the Organisation of Petrol Exporting Countries, and obtain a concession, whereby we can defer our daily quota, such that when we undersell, due to a crash in the price of crude oil, we can oversell when the prices stabilize, subject to the condition that we balance out our quota,” he said.
Atiku stated that Nigeria’s oil industry remained more susceptible to outside influences, than to internal control and that this measure could flip that, and make its oil industry more stable, even when there is global instability.
“This will translate to greater economic independence on our part,” he said.