Time to Pull Out of OPEC By Ade Medupin National Concord, Nigeria — 1983

I am delighted to share an AI-generated transcript of an article I originally wrote in 1983, more than four decades ago, and which was published in the National Concord newspaper. Looking back, this article brings back memories of an important period in my writing journey and of the privilege of contributing to a newspaper owned by the late Chief MKO Abiola (of blessed memory), with the late Dele Giwa as its Editor-in-Chief. Both men left indelible marks on Nigerian journalism and public life, and I remember them with deep respect and fondness.

Here, I revisit my original work, preserving its place in history while making it accessible to a new generation of readers.

Time to Pull Out of OPEC

By Ade Medupin

National Concord, Nigeria — 1983

The need for Nigeria to review its membership of the Organisation of Petroleum Exporting Countries (OPEC) has been generating a lot of debate.

Only recently, Senator David Dafinone came out very strongly against our continued membership of this multinational organisation and suggested that, in addition to quitting OPEC, Nigeria should also consider a barter arrangement in which oil would be sold to major foreign contractors and suppliers operating in the country.

This suggestion is patriotic but long overdue.

Right now, Nigeria is in dire need of foreign exchange, not only to service her huge external debts but also to import spare parts and raw materials in order to ensure that existing industries are productive.

Recently, the Governor of Lagos State, Alhaji Lateef Jakande, sounded a note of warning to the nation that “if the present economic situation in the country does not improve by March next year, at least twenty-five per cent of the industries will be closed down.”

He added that “other industries will also fold up if the economic crisis continues throughout next year.” This is not mere rhetoric. The situation in the country today is as bad as that. The effect of Shagari’s economic measures is biting harder and harder every day.

Thousands of Nigerians are joining the country’s already bloated unemployment market. Prices of essential commodities are skyrocketing every minute, coupled with the economic recession and the relatively high price of the commodity.

In light of all these developments, any measure taken by the government to bring back sanity, no matter how harsh, will not be regarded as out of tune. Certainly, one of such measures is the immediate withdrawal of our membership of OPEC.

No doubt, oil still remains very much in demand the world over. Prospective buyers have only slowed down owing to the world economic recession, coupled with the relatively high price of the commodity.

“In a world that is daily witnessing dramatic innovation in the field of science and technology, my fear is that sooner or later, our much-valued oil may become a liability. The United States of America has proved that when faced with hard times, they can do without oil. If not, how does one explain their sudden scramble for alternative sources of energy on which billions of dollars have been expended?”

On March 31, 1983, at an informal meeting with the representatives of the National Assembly, President Shagari commented on the need for Nigeria to continue to be a member of OPEC.

He said Nigeria joined the organisation because “we regarded its aims and objectives as being laudable and also knew that higher oil prices meant increased revenues to the government.”

On our continued membership of OPEC, the President said:

“We still regard the organisation as vital to our interests and we will continue to be a loyal and active member.”

By this statement, President Shagari left no one in doubt about the stand of his administration on this vexed issue. But since this statement was made about twenty months ago (during his first term), it is hoped that his present administration now realises that the prevailing circumstances in the country today no longer justify such a stand.

However, the question is: if our joining OPEC was as a result of the higher oil price which, at that time, meant increased revenues to the government, should we today still continue to remain in that organisation even when it is now obvious that the present declining oil price, resulting in rapidly decreasing revenue to the government, is a result of our continued membership of that organisation?

In a world that is daily witnessing dramatic innovation in the field of science and technology, my fear is that sooner or later, our much-valued oil may become a liability. The United States of America has proved that when faced with hard times, they can do without oil. If not, how does one explain their sudden scramble for alternative sources of energy on which billions of dollars have been expended?

For the sake of quick economic recovery, we should therefore seek for more sources of revenues, and one of such sources is to substantially increase our sales of crude oil.

We should urgently set in motion the machinery for our immediate withdrawal from membership of OPEC and thereafter drastically reduce the price of oil to attract more buyers.

By getting out of OPEC, we would be in a better position to sell more of our oil on the open market, and we would thus be selling much more than our present OPEC quota of 1.3 million barrels per day.

Mr Medupin is at the Centre for Management Development, Ikeja.