Oil Drops Below $35, Lowest Since 2004, Thereby Affecting Nigeria’s Economy Negatively

Oil Services and Tank. Source: Shorematter.
Oil Drops Below $35, Lowest Since 2004, As U.S. Supply Swells.

Reuters reports that, “Crude oil prices plunged 6 percent on Wednesday, diving below $35 per barrel for the first time since 2004 as data showing a shockingly large build-up of U.S. gasoline supplies fed fears that a global surplus was still growing.”

“The focus on Wednesday was U.S. government data showing a 10.6 million-barrel surge in gasoline supplies, the biggest build since 1993, which some traders said signaled a slow-down in demand that could prolong the global glut,” Reuters wrote.

Where as the price of Petroleum Motor Spirit (PMS) (fuel) continues to drop in USA to about US$2.00 per gallon, the reverse is the case in Nigeria where the price of fuel continue to increase in most places to about N120 per litre as against N85 per litre official rate.

Nigeria and USA Fuel Price

The Nigeria President Buhari during his 2015 campaign promised to stabilize the price of oil at OPEC. Even though he assumed the position of Nigeria’s Petroleum Minister, yet the price of crude oil continues to drop globally since he was took over the government and the price of domestic fuel continue to increase as well.