Nigerian govt raises alarm over potential economic shocks from Middle East crisis

The Federal Government of Nigeria has warned that the escalating crisis in the Middle East could trigger new economic shocks for Nigeria through rising energy prices, disruptions in global supply chains and shifting capital flows.

Authorities said they are closely monitoring developments and are prepared to adjust economic policies where necessary to limit potential disruptions, maintain investor confidence and protect the welfare of Nigerians.

The warning was contained in a statement issued by Uloma Amadi, Assistant Director of Information and Public Relations at the Federal Ministry of Finance. According to the ministry, the government’s Economic Management Team has already begun examining the possible economic impact of the crisis.

The ministry disclosed that the EMT, led by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, recently met to evaluate the implications of rising tensions involving the United States, Israel and Iran.

Edun also presided over a Naira-for-Crude policy coordination meeting during which officials reviewed developments in the global energy market and their possible effects on Nigeria’s economy.

Government officials identified three major channels through which the crisis could affect the country.

The first involves instability in global crude oil and gas markets, which could lead to higher domestic costs for petroleum products and other energy-related input

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The second concerns financial markets and capital movements. Heightened geopolitical uncertainty typically pushes investors toward safer assets, which could reduce capital inflows into emerging markets like Nigeria.

The third relates to global logistics and supply chains. Any disruption to key shipping routes or energy corridors could drive up freight costs and place additional pressure on local prices.

Meanwhile, the Islamic Revolutionary Guard Corps of Iran has issued a warning that oil shipments passing through the strategic Strait of Hormuz could be blocked as tensions intensify during the ongoing conflict involving the United States and Israel.

A spokesperson for the IRGC’s Khatam al-Anbiya Headquarters warned that vessels connected to the United States, Israel or their allies could become targets.

“You will not be able to artificially lower the price of oil. Expect oil at $200 per barrel,” the spokesperson said, adding that regional insecurity could drive prices sharply higher.

The Strait of Hormuz remains one of the most critical chokepoints in global energy trade, with roughly one-fifth of the world’s oil supply passing through the narrow waterway.

Analysts warn that any disruption in the corridor, combined with reduced production from some Gulf producers, could deepen fears of a new global energy supply shock.

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