Nigeria Woos Gulf Investors Amid Middle East Oil Disruptions

Nigeria’s Foreign Minister Yusuf Tuggar has called on Gulf oil and gas producers to view the country as a strategic partner rather than a competitor, especially as Middle East conflicts threaten global supply chains.

In an interview with Reuters, Tuggar highlighted the ongoing war involving Iran, which has disrupted shipments through the Strait of Hormuz—a vital route for about 20% of the world’s oil. This has led to halted exports and sharp price increases.
Tuggar said: “It’s in line with what we’ve always advocated – that countries which might otherwise consider us competitors should partner with us and invest so they can diversify their market share, working with us.”

Nigeria has boosted its crude oil output to around 1.7 million barrels per day (bpd) from 1.4 million bpd when President Bola Tinubu assumed office in 2023, overcoming challenges like underinvestment, theft, and pipeline vandalism, according to Tuggar.

He added that fresh capital for fields and pipelines could drive further growth.While some analysts warn that U.S. and Israeli strikes on Iran, along with Tehran’s responses against Gulf states, might delay African investments, Tuggar argued the crisis could spur partnerships.

“It could make them want to work with countries like Nigeria that are rich in gas and oil … to diversify market share for the benefit of both countries, or they could hold back,” he said.

Recent deals underscore the momentum. Nigeria and the United Arab Emirates inked a Comprehensive Economic Partnership Agreement in January, which Abuja expects to boost trade and investment.

Qatar-linked investors have also signaled plans for gas projects in Nigeria, though details on timelines remain vague.

Analysts highlight investment hurdles
Experts point to Nigeria’s lengthy approval processes and execution risks as barriers to realising such pledges, Reuters noted.
Tuggar acknowledged that higher global oil prices have strained Nigeria, a major importer of refined products, driving up transport and food costs—particularly during the Muslim fasting month of Ramadan when demand peaks.

However, he expressed optimism about resilience, citing the expansion of domestic refining. The privately owned Dangote refinery is now running at its full 650,000 bpd capacity, sufficient to cover local needs.Oil’s importance endures, Tuggar emphasised.

“At the moment the world consumes about 105 to 106 million barrels per day. I don’t see that changing much anytime soon, so we need to work together so we have enough hydrocarbons available,” he told Reuters.