The increase in electric vehicle (EV) sales in major importers of Nigerian crude oil, such as France, Spain, India, and the United States, is posing a significant threat to Nigeria’s petroleum revenue. In the first quarter of 2024, these countries saw substantial increases in EV adoption, with France experiencing a 24.3% rise, India 40%, Spain 12%, and the US a staggering 50% compared to the same period in 2023.
Nigeria, Africa’s largest oil producer, appears unprepared for a future where oil demand might diminish. Despite the warnings from the International Energy Agency (IEA) that global sales of electric and plug-in hybrid vehicles are set to reach a record 17 million units in 2024, up by over 20% from 2023, the country continues to heavily rely on oil exports. More than 88% of Nigeria’s total exports in the first quarter of 2024 were crude oil, according to the Nigerian Bureau of Statistics (NBS). Senior energy analysts, such as Tunde Ayeni, emphasize the urgent need for Nigeria to diversify its economy and reduce its dependency on oil revenues.
The impact of the EV boom is particularly concerning for Nigeria, where over 90% of export value comes from fuels and related products. Energy experts like Aisha Mohammed from the Lagos-based Centre for Development Studies highlight the acute economic vulnerability the country faces as global oil demand is projected to decline.
Source: Business Day