The federal government has said it is monitoring escalating tensions in the Middle East, warning that the crisis could affect Nigeria’s economy through higher oil prices, volatile capital flows and rising inflation.
In a statement on Tuesday, the Ministry of Finance said the conflict may impact the economy via crude market volatility, disruptions to capital inflows and rising logistics costs, which could feed into higher domestic fuel and consumer prices.
“Volatility in global energy markets is already driving increases in domestic prices, including fuel, diesel, cooking gas, and fertiliser,” the ministry said.
The Economic Management Team, chaired by Finance Minister Wale Edun, met to review the possible impact of the crisis and discussed developments in the domestic energy market, including the naira-for-crude policy aimed at supporting local refining and easing pressure on foreign reserves.
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Officials identified three immediate risks including disruption to oil and gas supply routes, reduced capital inflows as investors move to safe-haven assets, and higher global freight costs.
The ministry disclosed the scale of the impact would depend on the duration and intensity of the conflict, adding that prolonged instability could raise living costs and fuel inflation in sectors such as manufacturing, agriculture and transport.
Despite the risks, the government announced Nigeria enters this period with stronger economic fundamentals as GDP grew by 4.07 per cent in the fourth quarter of 2025, the strongest in more than a decade.
The ministry added that fiscal, monetary and energy policy teams are reviewing options to maintain stability, including interventions in foreign exchange markets, adjustments to fuel pricing and support for businesses.
It said the government remains vigilant and prepared to act to safeguard growth, protect citizens from external shocks and maintain macroeconomic stability.