The Federal Government has warned that rising geopolitical tensions in the Middle East could worsen the cost of living in Nigeria if the crisis continues.
According to the government, developments involving the United States, Israel and Iran could have significant implications for Nigeria’s economy due to the country’s connection to global commodity and financial markets.
This was disclosed in a statement issued on Tuesday by the Federal Ministry of Finance.
The statement said the Economic Management Team (EMT), chaired by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, met to assess the potential economic impact of the crisis and review possible policy responses.
Edun also chaired a meeting focused on the government’s naira-for-crude policy, where officials evaluated developments in the global energy market and their possible effects on Nigeria.
The government explained that escalating tensions in the Middle East have already created uncertainty in global markets, particularly over potential disruptions to major oil supply routes such as the Strait of Hormuz.
Concerns about supply disruptions are contributing to volatility in crude oil prices and global financial markets.
Edun said Nigeria could feel the impact through three main channels. These include fluctuations in crude oil and gas prices, shifts in capital flows and financial market conditions, as well as rising global logistics and shipping costs.
The minister warned that prolonged instability in the region could lead to increases in the domestic prices of fuel, diesel, cooking gas and fertiliser.
He added that disruptions to global shipping routes may also push up freight and logistics costs, which could eventually translate into higher prices of goods and services for consumers across Nigeria.
However, the minister assured that the government is closely monitoring the evolving situation and will take necessary measures to safeguard the country’s economic stability.
According to the ministry, the Economic Management Team is maintaining close coordination across fiscal, monetary and energy policy institutions to reduce the impact of external shocks.
“The Minister of Finance and Coordinating Minister of the Economy emphasised that careful policy calibration will remain central to the government’s response, ensuring that recent progress in macroeconomic stabilisation, revenue mobilisation, and economic growth is not undermined by external developments,” the statement said.
The government also reassured the public that it will continue to adjust policy measures where necessary to minimise disruptions, sustain investor confidence and protect the welfare of Nigerians.
