Nigeria’s Membership of the Organisation of the Petroleum Exporting Countries (OPEC): Weighing the Cost and Benefit

Abstract:

Crude oil remains an essential commodity that fuels the economy of countries the world over. On a high demand from time-to-time in the international oil market, countries endowed with the ‘black gold’ produce and export barrels of oil daily at a given price determined by the market forces of demand and supply. Nigeria, the largest oil producing country in Africa, maximum production capacity is 2.5 million barrels per day (bpd). Heavily dependent on the proceeds from the sales of her Bonny Light crude oil, it is in the best interest of the Nigerian State for oil prices to be high in the volatile international oil market. Hence, it became a full Member State of the cartel – Organisation of the Petroleum Exporting Countries (OPEC) in 1971. Over four decades later, Nigeria’s membership of OPEC became a topic for debate among erudite scholars, astute analysts and professionals in Nigeria’s oil industry following the plummet in oil prices from 2014 which adversely affected the country’s undiversified petro-dollar economy. This research paper weighs the cost and benefit of Nigeria’s membership of the oil cartel in order to ascertain whether Nigeria should remain a member or use the exit door out of OPEC. Theoretically, Realism was adopted for the study. Also used were the historical and comparative approaches with the qualitative method of secondary data collection.