A Barrel of Crude for $100: In defense of Nigeria

They analysts always predicted it and I always wondered who would get the blame for crude oil prices reaching the much-dreaded yet expected $100 price for a barrel. I thought the commodities speculators on Wall Street would blame themselves for creating this phenom (I think foolishly sometimes) or that ‘Big oil’ would come clean and say, “we are responsible.” Neither of this major players owned up but instead they once again tagged “fears about the unrest in Nigeria” and some other even lamer excuses.

I do not here try to deny or refute that the present situation in the Nigeria’s Niger Delta. I do actually believe that the issues in the south-south region of Nigeria have a destabilizing effect on oil supplies. This is so because Nigeria is the world’s 6^th largest oil producer. My contention however is that Nigeria has constantly been blamed for many spikes in crude oil prices. The Shortfalls in crude production in Nigeria is not a novel development; one would think that adjustments to counter this fact would have been put in place to prevent any worldwide effects.

The issues in the Niger Delta of Nigeria have been on-going for decades now, the main issue is one of an unimaginable greed perpetuated by the major oil companies, some corrupt Nigerian officials and host communities in the region trying to get back after decades of neglect. This greed has led to the current siege by gangs, rebels, militias (or whatever they want to be called) perpetrating mayhem on the region and its already impoverished citizens.

One would think that since all the ‘unrests’ were a common occurrence, OPEC, Big oil and other countries that import oil would adjust their expectations from Nigeria. Why still blame a situation created by the corporate greed and an insatiable taste for Nigeria’s light sweet crude? This question can be answered truthfully, but they never are. If the 6^th largest producer has been problematic for years then what about the other countries that along with Nigeria occupy the top producer’s list? Why do these nations not make up the shortfall and forestall spikes in crude prices. Why do the commodities speculators not factor this in and lower expectations from Nigeria.

The truth is that investors, the big oil companies and their promoters are the very interests benefiting from the spike and not Nigeria. Profits for the major oil companies are at an all time high, but developments and benefits for the Nigerian communities where this windfall seeps out in form of a black substance is at an all time low, poverty. Why Nigerians feel undone at home, they are being blamed for the failures of other nations coming to terms with reality. This must stop. It is an unfair tactic and does not in any way address the true reasons why just after reaching a record low of $15 a barrel just a decade ago, crude oil is at a $100 today. This is unacceptable.

The major oil consuming nations, the oil corporations and the very people causing unrests around the world in Iraq, Iran, Venezuela, (all oil producers) should be held to task on this recent price spike. No one should forget about the greed of the commodity speculators around the world when assigning blames. Nigeria contributes to the rise and rise of crude prices, but is not categorically responsible as many would purport. Please check the facts. Let us stop blaming the Nigerian people already.