Crude oil was discovered in commercial quantity in Oloibiri, in the Niger Delta in 1956. Production then was about 5100 barrels per day. This has since changed with a lot of multinational companies operating in the region in partnership with the Nigerian National Petroleum Corporation (NNPC) under a Joint Operating Agreement (JOAs) , while the indigenous oil companies operate in partnership with multinational companies as sole risk or as independents.
Nigeria ranks as the largest producer of oil in Africa and the six largest producer in the world. with a maximum crude oil production capacity of 2.5 Million barrels per day, this is certainly a lot when you check that at current price of $62 per barrel. That been said, Nigerians go through untold hardship in getting supply of petrol on a yearly basis especially in December when the festivities and holidays are the order of the day.
This December is no exception as there are queues at the Gas stations already, with pump price of NGN145 ($0.40) per liter of petrol. The festive period is usually characterized by lots activities people travelling for long distances from the cities to the village to be with their loved ones, lots of shopping, partying, fun fair and the list goes on all in the Christmas saga. As the scarcity of petroleum products takes center stage, it causes inflation as the few stations with products sell above the official pump price. This has a ripple effect on virtually every sector of the economy and thus increasing the level of inflation in the country.
One will wonder why a country ranked 6th in the world oil producers will allow its citizens to go through such hardship, I for one can't answer that. But what I do know is that when these prices sky rocket, there is no return as the spiral continues.
why the negative impact abound, there are still positive benefits that accompany it. As the saying goes "what goes around comes around". During these period, a number of vibrant young men and women engage in peddling/hacker of the products in gallons at exorbitant prices as the forces of demand and supply rule. The youths are engaged, keeping the crime rate at a low and their lives get better as they make some money from the trade.
The inflated prices affects all sectors and thus benefiting business men so to speak but to the economy in general,the value of the country's Naira depreciates and has no worth compared to other currencies like the US Dollar, Pound , euro and the Likes.
This is the December we experience in Nigeria every year, God help Us.
