Abuja, Nigeria – April 16, 2025 — The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has attributed the recent sharp decline in global crude oil prices to renewed protectionist trade policies implemented by U.S. President Donald Trump.
Speaking during a press briefing at the State House in Abuja, NMDPRA Chief Executive Officer, Farouk Ahmed, warned that Trump’s aggressive tariff measures were fuelling uncertainty in global markets, particularly in the energy sector.
“The global oil market today is reacting sharply to the erratic tariffing policies of the new American government,” Ahmed said. “These tariffs are not only aimed at China but are sweeping across multiple countries and regions. They are unsettling the balance of demand and supply, particularly in the energy sector.”
Ahmed stressed that investor confidence was being eroded by policy inconsistency from Washington. “The problem is not just the tariffs—it’s the inconsistency. One day, a major policy is announced; the next, it is reversed or escalated. This kind of back-and-forth has made it almost impossible for investors to make long-term plans,” he said.
The recent decline in oil prices comes at a time when Nigerian authorities are already grappling with foreign exchange pressures, sluggish subsidy reforms, and the need to attract investment under the Petroleum Industry Act (PIA). Brent crude prices fell by over 20% within a week of the U.S. tariff announcement on April 2, reaching a four-year low.
Although prices have recovered slightly to around $66 per barrel from below $60, they remain significantly below the Nigerian government’s 2024 budget benchmark of $75 per barrel. Crude oil accounts for 90% of Nigeria’s exports and is projected to fund 56% of the national budget.
Manufacturers Raise Alarm Over Tariffs on Nigerian Exports
Also reacting to the development, Director-General of the Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadir, expressed serious concern over the imposition of a 14% tariff on Nigerian exports to the U.S. He said the move could severely undermine the competitiveness of Nigerian-made goods in the American market.
“This tariff regime directly threatens trade dynamics between Nigeria and the U.S., especially at a time when we are recovering from recent economic setbacks,” Ajayi-Kadir said.
He noted that Nigerian exporters in key sectors—including agro-processing, pharmaceuticals, chemicals, and metal products—depend heavily on access to U.S. markets. Increased costs for American buyers could significantly reduce demand for these products.
According to the National Bureau of Statistics (NBS), Nigeria’s agricultural exports in 2024 were valued at over ₦4.42 trillion, with the U.S. among the top destinations. The new tariffs could potentially wipe out ₦1 trillion to ₦2 trillion annually in export revenue.
Ajayi-Kadir pointed out that the U.S. remains a vital trading partner, accounting for about 7% of Nigeria’s non-oil exports. In 2024, bilateral trade between the two countries stood at ₦9.59 trillion, with Nigerian exports making up ₦5.52 trillion of that figure.
He warned that the manufacturing sector—which contributed 8.64% to Nigeria’s GDP in 2024—is among the most vulnerable to trade policy shifts. “Higher market-entry costs because of these tariffs reduce the profitability of value-added manufacturing exports and could push firms to revert to exporting raw materials. This undermines Nigeria’s industrialisation goals and export diversification plans under AfCFTA,” he stated.
Economic Reform at Risk
Analysts warn that a sustained drop in oil prices, coupled with increased trade barriers, could jeopardize recent economic reforms and reverse Nigeria’s progress toward fiscal stability.
With Nigeria projecting a ₦55 trillion national budget this year, the country faces mounting pressure to find alternative revenue sources while safeguarding existing trade relationships.
