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Oil: Delivery Disappoints
Falling revenues force a budget rethink
Investors in the Nigerian oil industry are in for the long haul, despite the nation’s problems of continuing disruption to production in the Niger Delta and falling prices on the world stage. Contracting markets brought about by a largely global recession notwithstanding, Nigeria remains close to the top of the shopping list for the oil majors.
That is not to say that recent events have not taken their toll. At the end of 2008 prices had slumped to less than USD50 a barrel, or about a third of their peak for the year. President Umaru Yar'Adua is only too aware of what it means to his country’s fortunes for the coming year – or years. Proposing a USD24 billion 2009 budget, an increase over 2008 spending, the President’s figures assume federal government revenues for the world's eighth biggest oil exporter will decline in 2009, to an estimated USD13.4 billion compared to the USD19.4 billion originally projected. ...
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