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📰 Nigeria’s $5 Billion Aramco Loan Faces Delay Over Oil-Price Drop

Government & Politics 5 hrs ago
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    Juliet Tn
    5 hrs ago
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    Abuja, Nigeria — June 10, 2025

     

    Nigeria’s largest-ever oil-backed loan, a $5 billion financing deal arranged with Saudi Arabia’s Aramco, has hit a snag due to a sharp fall in global oil prices, Reuters reports.

     

    Originally proposed by President Bola Tinubu during a November 2024 meeting with Crown Prince Mohammed bin Salman, the agreement was designed to inject vital funding into Nigeria’s budget. Backing the loan would require Nigeria to deliver approximately 100,000 barrels of crude per day to Aramco over the repayment period.

     

    However, with Brent crude dropping from over $82 in January to around $65 per barrel by June, banks have grown wary. They are concerned the lower prices may make it harder for Nigeria to meet its collateral obligations and secure timely cargo deliveries .

     

    Nigeria already makes repayments on roughly 300,000 barrels per day from existing oil-backed loans. This new deal would nearly double that volume, raising questions about whether the country can meet the commitments—especially since oil output currently remains under 1.5 million bpd, well below the 2 million bpd national target .

     

    Analysts say the slowdown from banks—both Gulf-based and African—reflects broader caution in the oil-backed lending space as energy markets remain volatile. Both Saudi Aramco and Nigeria’s NNPC have declined to comment publicly .

     

    In response, authorities say efforts are underway to boost output and cut costs, guided by an executive order from President Tinubu. Yet the deal remains on hold, pending improved oil prices or revised lo

    an terms.

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  • Juliet TN
    Juliet Tn
    4 hrs ago

    📌 Why This Matters It would have been Nigeria’s single largest oil-backed loan, part of a $21.5 billion foreign-borrowing plan. The delay highlights Nigeria’s ongoing budget funding challenges and dependency on volatile oil revenue. Meeting the repayment terms depends on improving oil production and market prices.

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