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Falling Oil Prices: Faced With Crumbling Economy, Nigerian Minister Attacks OPEC

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With Nigeria’s foreign reserve falling below the $30bn mark and gloomy economic prospects, Mr. Ibe Kachikwu, the country Minister of State, Petroleum, has slammed world’s largest oil producer, Saudi Arabia, blaming the Kingdom of plunging oil prices.

Kachikwu, whose term as OPEC president lasted only a day in December, 2015, in an interview with U.S based global network, CNN, said OPEC was not expecting crude oil prices to enter the region of $20 to $30 per barrel, adding that the 2016 average would be between $40 and $50.

“I don’t expect to see it (oil) going to the twenties, I expect it on the fringes of thirties for maybe a month, two months, I expect it to see it to begin to climb.

“I’m actually optimistic that 2016 would end on an average of 40 to 50 barrel type level, but the first quarter would be very rough,” he said.

On Saudi Arabia’s insistence of keeping its share of market supply in the face of oversupply, Kachikwu said: “For us that policy is going too far, we need to sit back and see, how can we balance the need to protect market share, with the survival of the business and the survival of the countries who run these businesses.”

The IMF, Standard Chartered Bank amongst other financial firms have warned that oil could sell for as low as $10 per barrel before rebounding.

The price of OPEC basket of thirteen crudes stood at $25.76 a barrel on Tuesday, compared with $27.07 the previous day, according to OPEC Secretariat calculations on Wednesday.

With oil at its lowest since 2003, OPEC members are calling for an emergency meeting to cut output in a bid to raise demand for oil, and subsequently raising the price of crude.