Nigeria to Tap N6.8trn Fiscal Windfall from Oil Crisis
Nigeria will rake in N6.8 trillion in fiscal windfall from the global energy crisis, which has increased oil prices across grades, BMI, a Fitch Solutions Company, said in a monthly update obtained by MarketForces Africa.
Global crude oil prices top $120 per barrel amid an extended Strait of Hormuz blockade by the United States following a series of failed peak talks.
In its report, BMI said Nigeria is less exposed to the US-Iran conflict than most Sub-Saharan African (SSA) markets. “We have raised our 2026 real GDP growth forecast from 4.3% to 4.4%, making it one of the few upward revisions”, the BMI report said.
The firm said higher Brent crude prices, now expected to average USD78.0/bbl versus USD67.0/bbl pre-conflict, should deliver a fiscal windfall of about NGN6.8trn, or just over 1% of GDP.
The report explained that the removal of the longstanding fuel subsidy now means that domestic prices are exposed to international benchmarks. However, petrol prices in Nigeria have risen by over 50% since the start of the conflict.
This increase in petrol and diesel pump prices is expected to push the consumer price index higher again, forcing inflation to rise for the second month in a row.
Due to higher Jet A prices, local and international airlines have raised flight ticket prices, which are now compounding logistics costs in consumer inflation figures.
FitchSolution analysts expect this to be transient, tempered by a stronger naira, which should keep a lid on import costs. “As such, we have not amended our 2026 inflation forecast for Nigeria”.
