Follow Us on Google
Britain’s top trading partners like Nigeria, Kenya and Egypt will most likely be punished by a no-deal Brexit, says Lukman Otunuga, Senior Research analyst with FXTM.
In his analysis of latest development, Otunuga said the UK was Nigeria’s 6th largest trading partner last year with total trade roughly $5 billion. “In 2018, Nigeria exported £2.23 billion worth of Oil to the UK, an improvement over the level of £1.1 billion in 2017. But with the UK’s economy exposed to downside risks, the outlook for Nigeria’s Oil sales appears less promising.
Nigeria’s Oil sales in the UK and Europe face another challenge. Over and above the UK’s declining economic circumstances is increased competition from the US Light Sweet Crude Oil industry. In August, Oil sales slowed to their lowest level of the year because US Shale Oil flooded European markets. In July, Nigeria’s Oil sales to the US fell to zero as US president Donald Trump’s administration powered up its energy dominance policy. It is essential for Nigeria to regain market share in the UK and Europe, which accounts for 46% of its crude Oil sales. As demand and supply side challenges grow, Nigeria could benefit from closer relations with the UK government, which points out that it has extensive experience in building and managing oil industry infrastructure.” A trade deal which secures the UK as a guaranteed buyer of Nigerian crude Oil could certainly support demand in the long term.
