Nigeria’s government is assessing potential economic risks from escalating tensions in the Middle East, warning that rising oil prices and disruptions to global supply chains could affect domestic costs and financial stability.
Finance Minister Wale Edun convened a meeting of the government’s Economic Management Team on Wednesday to evaluate how the ongoing conflict involving Iran and its regional adversaries could impact Nigeria’s economy, according to a statement from the finance ministry.
Officials said the review focuses on potential effects on crude oil prices, capital flows, exchange rates and global logistics costs, as markets react to instability in one of the world’s most important energy-producing regions.
Particular attention is being paid to developments around the Strait of Hormuz, a narrow waterway between the Persian Gulf and the Gulf of Oman that handles roughly one-fifth of global oil shipments. Any disruption to tanker traffic through the corridor could significantly tighten global supply and push energy prices higher.
The finance ministry said volatility in global energy markets is already beginning to affect commodity prices, raising concerns that higher crude prices could translate into increased domestic costs for fuel, diesel, cooking gas and fertiliser.
While Nigeria is Africa’s largest oil producer, it remains heavily dependent on imports of refined petroleum products due to limited domestic refining capacity. As a result, global price swings can still feed directly into consumer prices and transportation costs.
Authorities warned that prolonged instability in the Middle East could place additional pressure on inflation and the cost of living, a key concern for policymakers seeking to stabilise the economy after a period of currency volatility and high prices.
Officials are closely monitoring crude price movements, exchange rate trends, capital flows and fiscal risks as part of their assessment. Nigeria’s external reserves and overall macroeconomic position are also being tracked to ensure the country remains resilient to external shocks.
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The government said Nigeria enters the current period with relatively stronger economic fundamentals compared with previous years.
According to official data, the country’s economy grew by 4.07 percent in the fourth quarter of 2025, reflecting improvements in oil production as well as contributions from agriculture and industrial sectors.
Despite the potential upside of higher oil prices for government revenues, analysts note that price spikes can also create challenges for oil-importing sectors of the economy and increase subsidy pressures if fuel costs rise sharply.
The Nigerian government said it would continue reviewing policy options to protect households and businesses from potential price shocks while maintaining investor confidence.
“We will keep monitoring developments closely and adjust policies where necessary to safeguard economic stability,” the finance ministry said in its statement.
Global energy markets have been increasingly volatile as investors weigh the risk of supply disruptions stemming from the Middle East conflict. The region plays a central role in global oil production and shipping, making geopolitical tensions there a key driver of commodity prices.
For Nigeria, the situation presents both opportunity and risk. Higher oil prices could boost export revenues and strengthen government finances, but rising import costs and inflationary pressures could offset some of those gains.
Authorities say the coming weeks will be critical in determining whether the geopolitical tensions translate into sustained market disruptions or remain a short-term shock.
