Oil Above $100: Economist Warns Nigeria Must Avoid Another Windfall Scandal
Korede Abdullah 
Mojeed Saliu,
LAGOS, Nigeria – Nigeria could earn billions of dollars in additional oil revenue as global crude prices surge above $100 per barrel, but economists warn that the unexpected windfall may not translate into improved living conditions for citizens unless the funds are managed transparently.
In an exclusive interview with Africa Health Report on Saturday, development economist Mojeed Saliu said the sharp rise in crude oil prices presents a significant fiscal opportunity for Nigeria, whose economy remains heavily dependent on petroleum exports.
The surge in global prices comes as tensions in the Middle East disrupt energy markets and threaten supply routes through the Strait of Hormuz, a vital corridor for global oil shipments.
Nigeria’s 2026 budget proposal, presented to the National Assembly by President Bola Ahmed Tinubu, is based on an oil benchmark price of about $65 per barrel and an average production target of 1.84 million barrels per day.
The budget outlines ₦58.18 trillion in spending, with projected revenue of ₦34.33 trillion and a deficit of ₦23.85 trillion.
However, with international oil prices now exceeding $100 per barrel, economists say Nigeria could generate substantial additional revenue beyond the projections contained in the budget.
“The development presents a potential fiscal opportunity for Nigeria,” Saliu said.
“Since oil accounts for roughly 70 per cent of government revenue and about 90 per cent of foreign exchange earnings, higher prices could strengthen government finances, provided the country is able to meet its production targets.”
According to him, when oil prices remain significantly above the benchmark used in national budgets, governments typically record excess revenue beyond projections, creating fiscal windfalls.
“If sustained over time, that gap could translate into billions of dollars in additional revenue for Nigeria.”
Such windfalls, he explained, would increase allocations shared among federal, state, and local governments through the Federation Account. They could also provide an opportunity for authorities to reduce borrowing if managed prudently.
Yet the economist cautioned that higher oil revenue does not automatically lead to better living standards for ordinary Nigerians.
“Increased revenue only creates the potential for improvement; it does not guarantee it,” he said.
“The impact on citizens depends on how effectively the funds are invested in productive sectors such as infrastructure, healthcare, education, and job creation.
Such mechanisms, he said, could help stabilise the economy against future oil price volatility while supporting long-term national development.
However, he warned that Nigeria’s past experience with oil windfalls offers important lessons.
During the Gulf War, global crude prices surged sharply, leading to a major increase in Nigeria’s oil revenues.
“Transparency begins with clear reporting of oil revenue and allocations at all levels of government,” Saliu said.
“Public disclosure of expenditure, independent audits, and legislative oversight are essential to ensure that windfall revenues benefit the broader population.”
The economist added that the latest oil price surge should also prompt broader policy discussions among government officials, economists, and civil society groups on how Nigeria can better manage resource windfalls.
“The goal should be to convert temporary windfalls into sustainable economic gains by strengthening savings mechanisms, investing in diversification, and ensuring that public spending translates into tangible development outcomes for ordinary Nigerians,” he said.
For Africa’s largest oil producer, the coming months could therefore test whether higher global crude prices will once again become a missed opportunity — or a catalyst for more responsible fiscal management.
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Hussaini Ibrahim 