Amidst escalating fuel prices in the country, the federal government has said it was monitoring developments following the Iran War and would undertake policy adjustments.
The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun disclosed this in a statement in Abuja,
this evening.
The statement signed by the Assistant Director Information and Public Relations, Mrs. Uloma Amadi, was however, silent on the policy adjustments meant to protect Nigerians.
According to the statement, “The Federal Government of Nigeria is closely monitoring escalating geopolitical tensions in the Middle East involving the United States, Israel, and Iran, and remains committed to safeguarding Nigeria’s economic stability.
“The Economic Management Team is maintaining close coordination across fiscal, monetary, and energy policy institutions. Policy options remain under continuous review to mitigate volatility and shield households and businesses from 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.
“He further noted that the Federal Government will continue to monitor the situation closely and adjust policy measures where necessary to minimise disruptions, sustain investor confidence, and protect the welfare of Nigerians.”
The Economic Management Team (EMT), chaired Mr. Wale Edun, was said to have met to assess the impact of the war on Nigeria’s economy.
The minister also chaired a Naira-for-Crude policy coordination meeting to review energy market developments and their domestic implications.
The assessment was that the situation remains fluid, with global market uncertainty driven by concerns over disruptions to critical energy supply routes, particularly the Strait of Hormuz, already contributing to volatility in crude oil prices and financial markets.
From the assessment, the government identified three immediate transmission channels through which the crisis could affect the Nigerian economy:
*Crude Oil and Gas Prices:
Volatility in global energy markets is already driving increases in domestic prices, including fuel, diesel, cooking gas, and fertiliser.
*Capital Flows and Financial Markets:
Heightened geopolitical risks may prompt a shift to safe-haven assets, affecting capital flows into emerging markets, including Nigeria, as well as broader financial market
conditions
*Global Logistics and Supply Costs:
Disruptions to major shipping and energy supply routes could raise international freight and logistics costs, putting upward pressure on domestic prices.
The minister noted that beyond these immediate effects, sustained instability could drive increases in the cost of goods and services, placing further upward pressure on inflation and the cost of living.
According to the statement, “At the EMT meeting, Ministers provided sector-specific updates on the evolving situation. Discussions recognised that the ultimate scale of impact on Nigeria will depend on the duration and intensity of the conflict, particularly its effect on global oil supply and prices.
“The Economic Management Team is closely monitoring developments across key macroeconomic indicators, including:
• Global crude oil price movements and supply conditions
• Exchange rate developments and potential pass-through to domestic prices
• Capital flows and financial market conditions
• The implications for Nigeria’s fiscal outlook and external reserve.
“The government remains fully committed to protecting these gains.”