How Russian –Ukrainian War Helped Nigeria’s Total Merchandise Trade Go Up to N13trillion

Olushola BelloJune 8, 2022

3 minutes read

The Russian –Ukrainian war has helped Nigeria’s total merchandise trade to go up to N13 trillion in the first quarter of 2022, indicating an increase of 11.05 percent over the value recorded in the fourth quarter of 2021 and 65.41 percent higher when compared to the value recorded in the first quarter of 2021.

…Crude oil major export with N5.6 million Value

The export trade in the quarter under review stood at N7.1 trillion, showing a rise of 23.1 percent over the value recorded in the preceding quarter and also an increase of 137.9 percent over the corresponding period of the preceding year.

The Foreign Trade Report of the National Bureau of Statistics has stated.

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On the other hand, total imports were valued at N5.90 trillion, indicating a decrease of 0.7 per cent over the value recorded in the preceding quarter.

According to the report, the value of exports trade in the first quarter of 2022 was dominated by crude oil exports valued at N5.6 trillion which accounted for 79.16 percent of total exports while non-crude oil exports value stood at N1.4 trillion or 20.84 percent of total exports, of which non-oil products contributed N715.19billion representing 10.07 percent of total exports.

The figures stated in by the report indicated a 194 per cent increase in Nigeria’s crude oil exports when compared to the first quarter of 2021 (N1.9trn).

The figures also indicate the continued decline in the performance of the non-oil sector, which contributed N1.47trn (20.84 per cent) to the total exports in the period under review.

According to the report, the value of manufactured goods stood at N3.1 trillion, representing 24.55 percent of total trade. However, the export component accounted for only N219.08 billion of the total trade, meaning Nigeria imported nearly 15 times the value of manufactured goods it exported in the first quarter of the year.

Speaking on the causes of the sharp increase in the amount of exported crude within one year, an energy expert, Bala Zaka, said the numbers did not necessarily mean an increase in the volume of exports.

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According to him, factors such as the Russia-Ukraine war had led to a significant rise in the price of oil in the international market; and, as a result, oil revenue had increased far above the projected benchmark when the year began.

“It’s not that the quantity of crude oil increased. It is the shortage in energy as a result of the Ukraine-Russia crisis. Even before that time, some countries were having issues. Because of these shortages, and based on the principle of demand and supply, the demand was generally high globally. That led to the increase in the price of crude oil per barrel. Right now, the price of crude oil is more than $120. Around this time last year, it was not even up to $80.

“When we started, the benchmark price for crude oil was about $57 per barrel. That was what they predicted when they were preparing the 2022 budget. But before we knew it, they increased it to about $62. The volume didn’t necessarily increase. It was the price per barrel that increased.”

Organisation of Petroleum Exporting Countries (OPEC) has raised Nigeria’s oil production quota from the 1.735 million barrels per day (mbpd) target approved in May 2022 to a new target of 1.772mbpd for June 2022.

A statement issued, yesterday, said OPEC took the decision at its 28th OPEC and non-OPEC Ministerial Meeting, despite Nigeria missing its approved target for April 2022 by 40,000bpd.