South Korea’s $100 Billion Energy Deal Deals Major Blow to Nigeria’s Oil Exports
Massive US energy purchase threatens Africa’s largest oil producer’s grip on Asian markets
Nigeria’s crude oil industry faces a significant new challenge as South Korea finalizes a $100 billion agreement to purchase US energy over the next four years, potentially devastating one of Africa’s most critical export relationships. The deal, signed during President Lee Jae-myung’s state visit to Washington, cements Seoul’s position as the largest Asian buyer of US crude oil.
Currently importing 460,000-470,000 barrels per day of US crude valued at $12-14 billion annually, South Korea’s deepening dependence on American supplies threatens to displace traditional African suppliers. Nigerian light sweet crude grades such as Qua Iboe and Bonny Light, long favored by South Korean refiners, now face intense competition from US supplies that benefit from competitive pricing and shorter shipping routes.
The timing couldn’t be worse for Nigeria, which has struggled with production challenges including theft, underinvestment, and infrastructure issues. Despite being Africa’s top oil producer, Nigeria has repeatedly failed to meet its OPEC quota, with output only recently recovering to around 1.5 million barrels per day.
“South Korea’s deal with the US is a red flag for Nigeria,” warned an energy analyst in Lagos. “Traditional buyers in Asia are diversifying toward cheaper, more reliable suppliers, while Nigeria struggles with theft, underinvestment, and production shortfalls.” The development comes as global competitors strengthen their positions, with Iran lifting production to 3.24 million barrels per day and Libya targeting 2 million barrels per day by 2028 with renewed US investment.
Source: angolanminingoilandgas.com
