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Sunday 20 June 2021
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South Africa and Nigeria warn on high oil prices

This Day (Nigeria)

Nigeria and South Africa yesterday in Johannesburg, warned that rising crude oil prices posed a major threat to on-going global efforts to alleviate poverty in third world countries, particularly Africa.

In Washington DC, United States, however, Finance Minister, Ngozi Okonjo-Iweala said the Federal Government has so far spent N132 billion to subsidise pump price of fuel in the country.

Speaking at the opening of the 18th World Petroleum Congress (WPC) in Johannesburg, South Africa, Minister of State for Petroleum Resources, Dr. Edmund Daukoru said the current run-away oil product prices was a signal that the fragile economies of Africa would be so severely hit and they might not likely meet the Millennium Development Goals.

Daukoru said developed countries must take urgent steps to address the decline in refining activities as crude oil prices themselves were being driven by products supply constraints. He said with current oil prices, Africa might not be able to benefit from the recent round of debt forgiveness.

“The increase in products prices will affect us and I really already signaled that they must do their own part as consumers if this is not to impact on the fragile economies of Africa.

“We don’t want anybody to put the blame on producing countries and I wanted Nigeria not to be held as a scapegoat along with other oil producers by putting the blame on products prices.

“I am really implying that Nigeria itself is a victim of products prices of which the developed countries have to do something in terms of refining capacity,” he said.

Also speaking at the opening of the WPC, South African President Thabo Mbeki said the most urgent global issue to be addressed is that of the current high crude oil prices, which he stated, might spread a fresh round of poverty and threat to peace in Africa.

Mbeki said already, the UN Millennium Review Summit held last week in New York, did not achieve the desired level of success in the set objectives in the areas of global poverty alleviation and eradication, world peace and security, and the reforms in the United Nations in order to improve its effectiveness.

He noted that while progress was being made towards implementing the debt write off for some African countries, the world, particularly developed nations, must also take notice of the serious impacts on poverty reduction prospects, that high and volatile oil prices could have on many developing countries, especially oil-importing Sub-Saharan African countries.

Rising oil prices, which closed yesterday at $63.10 per barrel, was blamed for last month’s 30 percent hike in domestic pump prices of fuel by the Nigerian National Petroleum Corporation (NNPC). A litre of petrol now sells for N65.00 instead of N50. Gasoline prices has also been raised in South Africa from R4.00 to R5.10 per litre.


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