The current Iran/US war has disrupted global systems. Oil refined and crude powers the world, and with the Middle East at the centre of the conflict, the flow of oil has been affected, triggering widespread economic consequences.
Global economic forecasts are now gloomy. Some countries are already facing recession, while others are rationing energy. With fertiliser shortages also emerging, there are fears of looming global hunger.
If the situation around the Strait of Hormuz is not resolved quickly, the crisis could escalate into a global economic catastrophe.
Even strong economies are struggling to withstand the pressure. The implication for weaker economies like Nigeria is even more concerning.
A war with Iran had long been anticipated but was avoided due to fears of unintended consequences. That restraint appears to have collapsed.
For Nigeria, while citizens are reacting to rising fuel prices, the reality is that the country is relatively fortunate. In dollar terms, local fuel prices remain below global averages, and more importantly, supply has not been disrupted.
The existence of a functional refinery has helped cushion the impact. Without it, the country would likely have faced severe fuel scarcity, with black market prices possibly soaring between N6,000 and N10,000 per litre.
Industry stakeholders agree that Nigeria would have been in serious trouble without local refining capacity.
However, the country’s refinery challenges are longstanding. Insights from industry insiders point to systemic sabotage, particularly during the military era, when the drive for profit from fuel importation undermined local refining.
Technicians and officials were also implicated in ensuring refineries did not operate optimally, sustaining dependence on imports. This culture, observers say, persisted for decades.
The question remains: if government-owned enterprises could not be protected, what hope exists for private investments?
Several sectors — petrochemicals, steel, paper and automobile manufacturing — have suffered similar decline, despite Nigeria’s early promise of industrialisation.
Government policies continue to contradict stated goals. While authorities promote local production, waivers are often granted for imports, undermining local investors.
The business environment remains difficult, with policy inconsistencies and regulatory bottlenecks discouraging genuine entrepreneurship. As a result, those who thrive are often those aligned with government interests or import-dependent businesses.
Nigeria’s institutional weaknesses further compound the problem. Educational and research institutions have not effectively translated knowledge into practical solutions for development.
Local innovations receive little support, while foreign alternatives dominate the market.
The lesson from the ongoing global crisis is clear: nations must strive for self-sufficiency, especially in critical sectors.
Nigeria cannot afford to remain dependent. The country must take deliberate steps to secure its future or risk severe consequences in the face of global disruptions.
VANGUARD
