IIARD International Institute of Academic Research and Development

IIARD International Journal of Economics and Business Management (IJEBM )

E-ISSN 2489-0065
P-ISSN 2695-186X
VOL. 3 NO. 1 2017

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Overview of the Performance of Oil and Gas Sector in Nigeria (1981-2014)

Chidi U. Ubani & Olusegun Adeteji Okutimiren, Adeogun Olubukola Simeon and Ilori Gbenga Ezekiel (PhD)

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Abstract

For the past three decades, oil has been a major source of revenue and energy for the Nigerian economy. Ironically, the huge oil revenue that has accrued to the country has not satisfactorily impacted on the living conditions of majority of the citizens. The “paradox of plenty” lends support to the “resource curse” doctrine that abundant natural resource endowment makes a country poorly focused on growth and development. Against this background, this study evaluates the performance of the oil and gas sector in Nigeria (1981- 2014). The required data for this study was sourced from Central Bank of Nigeria (CBN) statistical bulletin and the study started with a test of stationarity of time series data using Augmented Dickey-Fuller test, while Johansen test for co-integration ascertains the long run relationship of the variables. Ordinary least square was used to analyze the data. The results show that investment and oil export has a positive relationship with output level of gross domestic product (GDP). The R-squared result revealed that 95.2% of the total variation in economic growth is accounted for by changes in the explanatory variables. The study recommends that appropriate policies to address the issue of oil dependence in Nigeria should focus on diversification and industrialization to promote economic growth. Also, government should increase its expenditure on rural roads and electricity as this will accelerate the productive sectors as well as raise the standard of living of poor citizens.

keywords:

Economic growth, Government Policy, Oil and Gas Export, Resource Curse Doctrine, Nigeria.

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