Nigeria 2023 election will be the most open election in Nigerian history.  I have called it the year that information technology will disintermediate decades-old political structures in Nigeria as social media, SMS, etc remove (partly) information asymmetry, making it possible for citizens to have the right information and make the calls.

My thesis is that we will have a higher correlation between ideas & visions and electoral results. If that becomes statistically significant, Nigeria will begin to rise, henceforth, as higher quality managers will join Nigerian politics. For Abeokuta to respond this way for Peter Obi does imply that mobile internet is transforming Nigeria at a rapid pace.

Comment on Feed

Comment 1: The presidential election is between Obi and the rest, he remains the only candidate with a clearer route to Aso Rock. Anyone who pays attention knows who has the momentum, but of course – people who are not doing great will always find ways to be part of the conversation and create some hope for themselves. The man Obi has about 15 states within reach, if he picks just two in the southwest with Lagos obviously very competitive, he wins Aso Rock.

Something very interesting is happening in Nigeria, for those who really know how to read events, but again, if the result of a match is already known, what’s the essence of playing? So we have to keep the conversations going!

Comment 2: The truth be told the system of apc and pdp has really put nigeria backwards and its really affecting the youth badly,everyone is tired of this old system of ruling nigeria,we want a better nigeria,we want a nigeria that will be respected again,we want to take back our title of been the giant of Africa…#am obedient

Nigerian Presidency is Wide Open As Mobile Internet Could Disintermediate Old Political Structures

As we know,  G7 – a club of rich countries which include the US,  Britain, Canada, France, Germany, Italy, and Japan – plans to put a price cap on Russian oil: they will  “ban the insurance and financing of shipments of Russian oil and petroleum products unless they are sold under a set price cap.” While many may see this as a possible harm to Russia, I call on policy makers in Nigeria, Angola and other African countries to wake up. There is another alternative viewpoint which is like this:

If Russia does agree to keep pumping oil and be selling below market price which has been determined by G7, expect a massive shift in market equilibrium. In other words, if Russia has the cheapest oil, everyone will buy from  Russia because it is selling cheaper than other oil producers. If that becomes the case, what would Nigeria and Angola do? Under this scenario, we do assume that Russia can pump more to its highest capacity.

So, we need to understand that it is not Russia that would be harmed; Russian oil will be cheaper and global markets will stop buying from Nigeria. And if that happens, it would be like a covid-19 moment when no one was ready to take delivery of oil.

Nigeria and other oil producers must demand that G7 puts a volume maximum which Russia can sell under this price cap. If not, there would be surprises in many economies.

(Russia had noted that it would not sell below market price. Do not bank on that. It can technically sell at lower price and make up via higher volume.)

The world’s major industrial powers are going forward with a plan to cap the price of Russian oil. As Russia’s war against Ukraine drags on, the Group of Seven — Britain, Canada, France, Germany, Italy, Japan and the U.S.— says it will “ban the insurance and financing of shipments of Russian oil and petroleum products unless they are sold under a set price cap,” The Wall Street Journal reports. The G-7 hopes the yet-to-be-determined cap will reduce Russia’s oil revenue without hampering global supply or raising prices.

The plan comes with several risks, analysts say. Russia has said it may simply refuse to sell oil under a price cap. There’s also no guarantee that major buyers of Russian oil, most notably India and China, will go along with the plan. (LinkedIn)

Comment on Feed

Comment: You can bet on that.
Russia will not sell at a lower price and go for volume.
It’s not just a bad move economically, it’s a sign of weakness.
Not only will Russia not accept lower prices but also neither will MBS.

My Response: Sure- they will not sell at a lower price. That is the default state. Yet, that does not mean other oil producers should  relax since I do not see how a British buyer will see Russian oil going for $60 and yet paying $100 for Nigeria. What stops him from buying Russian oil by opening a Turkey subsidiary. This price cap makes no sense.

Comment 2: Inasmuch as the world cannot be in self-denial or delusional about the degree of aching effects of the Putin’s Order on the West and Europe —and by extension, the escalation effect on Africa —the politics of national interests cannot be side-chicked as well. Hence the G7 response to Putin’s energy cut!

Again, such a response must be well guarded and guided with a view to CAPing the envisaged, negative impacts on other economies, especially the petrodollar economies like Nigeria and Co!

My Response: In geopolitics, it is self-preservation. I am not sure G7 has to think for Nigeria.  It is Nigeria that needs to make itself heard.  Putin will not likely sell at a lower price. But nothing is 100%.

Comment 3: For Nigeria, does movement in the price of oil make a difference to our lives anymore? Our policies have been so badly designed and implemented that we can’t take advantage of price movements. The new definition of problem is when the government of an oil producing country would claim that upward movement in oil prices hurts their economy.

My Response: Great words indeed. Oil does not move sideways. For Nigeria, up or down is pain. High oil price, more problems with import of fuel. Low price, drained foreign reserves.

Comment 4: Not so fast. Even if Russia doubled its oil production capacity which is impossible to do even in the next 10 years. Production increases in oil don’t happen overnight. Russia under sanctions doesn’t have the wherewithal to achieve such a feat; not even the USA with her advanced fracking technology can quickly double its production in so short a period. There are several factors such as Rigs, spare parts, shipping and storage logistics that will make the scenario unlikely.

My Response: What is Russia’s production capacity and how much is it pumping today? My point is that we do not need to look at this new “sanction” from one angle when other countries could be imperiled.  If Russia decides not to pump, Europe will outbid most African countries in the global oil market. So, in the end, in trying to punish Russia, pains come to many others. While capacity cannot be added overnight, cheaper oil will drive demand at scale. That will distort the market until we can re-attain equilibrium again.

Comment 4R: Ndubuisi Ekekwe Russia crude oil production capacity is about 10.9m barrels, it currently produces about 9.9milion barrels leaving room for additional one million barrels. Russia under the current sanctions cannot easily ramp up to the 10.9m capacity. If Russia is able to ramp up production quickly as you posit in your scenario it wouldn’t hurt the world. Honestly lower oil prices are very good for the world economy especially Africa. It would reduce earnings for the few African producers but help the larger African economies .Perspectives may differ on what the outcome of the G7 price cap on Russian crude will be but I don’t think Russia can afford to stop pumping crude to protest any price caps. If on the other hand it leads to lower oil prices across the world , the world economy will be better for it. I strongly don’t think a barrel of crude oil should exceed $70. A price of $65-$75 is good for the world economy. On the flip side, higher oil prices will accelerate the deployment of climate smart energy alternatives and technologies for which the world will be better off. Russian oil is already sold at a discount of about 30% ( $60 per Barrel). A further price cap of say $30 per barrel won’t be bad for the world economy.

My Response to 4R: Good point but Putin is a moving target. Visit some Russian websites, they are sharing that some American and EU companies are opening Turkey subsidiaries to buy the cheap capped oil and then resell them at the free market price. Europe and US will be fine in this game. My concern is Africa.  I posit that EU/US buyers will buy the cheap Russian oil and then resell to Africans under the guise that only companies with capacity to vet oil source can trade. So, under that, Africans will not have access to the cheap as the insurers will like to deal with “trusted” buyers who can validate the capped prices. Those licenses of trusted partners will be given exclusively to EU/US traders.