Prices of petroleum products in nigeria economics essay

A fall in oil prices is effectively like a free tax cut. Shell Petroleum Company has long legacy of pollution in the region. Agricultural practice had fed the nation before the discovering of oil. Other economic impacts of lower oil prices Reduced profitability for alternative energy sources.

The fear is that once the Eurozone enters deflation, it could prove very difficult to escape if it is not too late already and it could lead to a long period of stagnant growth — which would be very bad news for attempts to reduce debt to GDP ratios. This is why Saudi Arabia has so far not responded by cutting output.

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The economics and politics of fuel prices in Nigeria

There is still strong latent demand in Asia India and China. Petroleum Production undermines agricultural production. The gaping hole in the political wall was the massive goodwill or huge credit balance the government enjoyed during its honeymoon.

A fall in oil prices could lead to a significant budget deficit and social problems. But the problem is that — looking at the wider economic situation it is hard to get too optimistic. Though there are fears of a slowdown in Asian growth, the fall in oil prices may be overdone.

Oil exporters For oil exporters, a falling oil price is bad news. However, many are deeply fearful about prospects for the European and global economy.

Nigeria joined the ranks of oil producers in when its first oil field came on stream producing 5, bpd. Falling oil prices rather than helping increase spending are pushing down the headline inflation rate and making actual deflation a real possibility. He said the landing cost of petrol also called Premium Motor Spirit has automatically changed from N Continued low growth around the world, is holding back demand.

This is a concern because deflation tends to cause serious macroeconomic problems: Falling oil prices will lead to a government budget deficit, and will require either higher taxes or government spending cuts.

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EU inflation has fallen to a five-year low 0. Would a government visit on its people another round of hardship soon after an economic recession because market fundamentals have been changed dramatically?

Falling oil prices will also help reduce headline CPI and allow the Bank of England to delay any rise in interest rates. We can see that from the past six years — oil prices have been quite volatile — there is a strong likelihood that sometime oil prices will increase again.

The bottom-line of all current possible scenarios is the welfare of the people, which even weakens the economic argument for fuel price increases. Government forced the people of Ogoni to hand over their land to oil companies with negligible compensation.

Marketers bring in a certain volume and NNPC also brings in a certain volume. About this resource This Business essay was submitted to us by a student in order to help you with your studies. It is unlikely OPEC will want to tolerate low oil prices for too long.

In theory, the fall in oil prices could lead to higher spending on other goods and services and add to real GDP. Essay UK - http: The review of the development was the competition among region towards socio-economic development.- The largest petroleum-producing nation in Africa is Nigeria.

The petroleum company is the main contributing factor of the GDP in the West African nation, which is also the continents, most noticeable and populous reserves.

In petroleum refining, crude oil is distilled at atmospheric pressure to recover valuable petroleum products like LPG.

Impact of falling oil prices

Nigeria joined the Organisation of Petroleum Exporting Countries (OPEC) in and established the Nigerian National Petroleum Company (NNPC) ina state owned and controlled company which is a major player in.

petroleum and its products in Nigeria[1]. According to Ghalayini[2], crude oil has become one of the main indicators of economic activity worldwide, due to its outstanding importance in the supply of the world's energy demands.

Modelling Petroleum Product Prices And The Nigerian Economy 73 | Page PURPOSE OF. Nigeria and petroleum Nigeria is among the biggest producer of petroleum on the planet and the biggest in Africa.

Presently, it can’t meet the demand of petroleum products, because of corrupt practices from its leaders, who take petroleum products to different nations to refine and later export back to the country as finished products.

Published: Mon, 5 Dec INTRODUCTION.

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The prices of petroleum products in Nigeria have been a source of contention and controversy. Meanwhile, the Nigerian economy which used to depend on the agricultural sector decades ago now depends heavily on the oil sector which, the International Monetary Fund (IMF) says accounts.

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Prices of petroleum products in nigeria economics essay
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