In a pivotal development for its economy, Nigeria has announced it will commence the sale of crude oil in its local currency, the naira, moving away from the traditional reliance on the US dollar for international commodity trading. This strategic decision aligns Nigeria with a growing trend among various countries that have started to adopt local currencies for oil and gas transactions, particularly in response to economic pressures exacerbated by the Russia-Ukraine conflict that began in February 2022.
On Sunday, Mohammed Manga, the Director of Information and Public Relations at the Ministry of Finance, confirmed that the Federal Executive Council (FEC) has directed that all crude oil sales be conducted in naira. This initiative is designed not only to facilitate transactions but also to strengthen Nigeria’s economic framework by promoting growth, enhancing market stability, and fostering greater self-sufficiency in its energy sector.
Manga underscored the importance of this shift, noting that Nigeria is navigating the complexities and challenges posed by global market dynamics. He expressed confidence that this strategic move would position Nigeria favorably for future economic success and resilience in the face of external pressures.
With approximately 37 billion barrels in proven oil reserves, Nigeria holds a significant position in the global oil market, accounting for about 3.1% of the world’s total reserves. The country ranks among the top 15 crude oil-producing nations, boasting the eighth-largest reserves globally and standing as the sixth-largest oil exporter, highlighting its vital role in the international energy landscape.