Nigeria’s Membership of Organisation of Petroleum Exporting Countries (Opec).A Critical Evaluation of Cost And Benefits.


Nigeria as one of the major oil producing country is also one of the eleven members of Oil Producing Exporting Countries(OPEC) formed in 1960 to regulate production and supply of crude oil in the international oil market.

Nigeria’s membership in OPEC since 1971 has generated huge foreign capital through oil supply and has not conferred on her automatic economic benefits rather has been met with several fiscal measures such as SAP to reduce the problem of hyper inflation etc. on the other hand, it has promoted corruption, crime, mono economy and social unrest among others.

In spite of this negative impactsrecorded, however, it has also been associated with positive records. It is against this background that an evaluation of cost and benefit of Nigeria’s membership in OPEC is carried out since her membership.

In view of this, most literatures reviewed are secondary data and the internet so as to help the researcher to making rational judgments to situate the subject into proper analysis.

Table Of Contents

Title page






Table of content

1.0Chapter One: General Background of the Study

1.1 Introduction

1.2Statement of Research Problem

1.3Research Questions

1.4 Objectives of the study

1.5 Scope and limitations of the study

1.6Theoretical Framework

1.7Research Methodology

1.8 chapter outline

2.0 Chapter Two: literature review

2.1 Introduction

  • Formation of OPEC and Nigeria’s Membership
  • Importance of Oil to Global Economy
  • Role of OPEC (Oil) in International Economy and Politics

2.5 Nigeria’s Membership in OPEC

  • Nigeria’s Membership in OPEC- fair deal or not
  • Nigeria as Simultaneous Producer/Consumer Nation of Crude oil

2.5.3 Oil andNigeria Economy

Chapter Three: Formation, Activities and Structure of Opec

  • Structural Organization of OPEC; how decision are made

3.3 Activities of OPEC since 1960

3.4 Activities of Member Countries in Opec

Chapter Four: Presentation and Analysis of Data

  • Nigeria from Agriculture to Oil Economy
  • Nigeria’s Role in OPEC; Challenges and Prospects
  • Cost and Benefits to Nigeria as aMember of OPEC

4.5 Major Findings and Verification

Chapter Five: Summary, Conclusion and Recommendation

5.2 Summary

5.3 Conclusion

5.4 Recommendation



Background Of Study

The Organization of petroleum Exporting Countries (OPEC) Formed in 1960, is a cartel formed by oil-producing states for the purposes of monitoring and regulating output and prices of petroleum product by placing quotas which serve as control mechanism towards the production and supply capacity of member countries.

Nigeria joined the organization in 1971 with the purpose of trading her natural resources to improve on her foreign exchange earnings and to boost her economy.

Ever since her economy and foreign exchange earnings have been largely dependent on the production quota given by OPEC.

To this extent, Nigeria prepares her annual budget based on the envisaged international price from sales of oil at the international market for e.g in 2007 the benchmark of 43$ to 56$ was used to prepare Nigeria’s budget.

(Business watch, 2009) and has also been able to place an appreciable price on  how much she sells  her oil irrespective of the fixed price by OPEC.

It is understood that member countries of OPEC have benefited in a way that cannot be overlooked.


Bright Erakpoweri Okoguo (1985) Oxford University “The Outlook for Nigerian oil” A paper presentation at the Seminar on Nigeria Economy A.B.U Zaria and Nigerian Institute for Social and Economic Research (NISER), Ibadan November 11-15.

Business Vanguard June 24, 2008. Business Watch Oct. 2010.

Charles F .Doran (1977): Myth, Oil and Politics: Introduction to the Political Economy of Petroleum, Free Press third Avenue, New York.

Dr Abass P.G Class 2011, Class Note on Issues in Nigerian Government and Politics.

Department of Political Science, Ahmadu Bello University.

Emerging markets data file.”Nigeria must remain in OPEC world sources, ic, Xinhua.29jan 2003.

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