NIGERIA faces a possible more challenging economic future as yesterday's US presidential elections that resulted in protectionist and isolationist Donald Trump being elected is expected to lead to a further collapse in global oil prices.
In an unprecedented night in US politics, Mr Trump of the Republican Party beat the favourite of the Democratic Party Hillary Clinton by winning 276 electoral college votes to 218. His unexpected victory has made global financial markets nervous as he has promised to adopt a protectionist trade policy that is unilateral and not multilateral.
Pulitzer Prize-winning oil historian, Daniel Yergin, has already said that plans by the Organisation of Petroleum Exporting Countries (Opec) to prop up prices have just got harder with Mr Trump's victory. About two years ago, crude oil was selling for over $100 a barrel but now it is around $45 and Opec has planned to seek an international agreement to rally prices.
Mr Yergin said that the 14-country oil-producing group may have to battle a sourer outlook for the global economy and weaker demand for crude oil. He added that Opec's internal dynamics could change, with Mr Trump promising to tighten policies on Iran just as oil companies slowly begin to return to the Islamic republic.
“Buckle up your seat belts for a more turbulent and uncertain global economy ahead. The outcome of the US election has added to the challenges of oil exporters because it will lead to weaker economic growth in an already fragile global economy and that means additional pressure on oil demand, " said Mr Yergin, who is also the vice chairman of IHS Markit Think Tank.
Meanwhile, Opec will meet on November 30 in an effort to curtail output and reduce the global oil glut that has seen prices more than halve since 2014. Opec sources said they expected oil to remain weak in the days and weeks ahead due to worries about the global economy and uncertainty about Mr Trump’s policies for the Middle East.
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