Nigeria’s revenue earning capacity has come under threat following the reduction of importation of crude oil by India.
India, Nigeria’s largest crude oil importer, reduced crude oil imports by $39.5bn in April, compared to the same time the previous year, data from India’s Petroleum Planning & Analysis Cell showed.
According to the Indian High Commission in Nigeria, India’s crude oil imports from Nigeria in 2020 amounted to $10.03bn.
This represented 17 per cent of Nigeria’s total crude exports for the year according to the Nigerian National Petroleum Corporation.
As Nigeria’s largest importer of crude oil, lockdowns in India’s major cities from COVID-19 surge in April had ripple effects on Nigeria’s oil sales.
India had been buying the not-too-light and not-too-heavy Nigerian crudes that suited its refiners.
India reportedly bought more American and Canadian oil at the expense Africa and the Middle East, reducing purchases from members of the Organisation of the Petroleum Exporting Countries to around 2.86 million barrels per day.
According to Business Today, an Indian paper, the country currently imports 82 per cent of its oil needs, which amounted to $87bn in 2019.
The state owned Oil and Natural Gas Corporation produces about 20.3 million tonnes of crude oil annually. Increasing total production to 40 million tonnes will reduce total imports to 67 per cent.
