Oil powers went the extra mile

the Historic drop in oil prices early this week has led to the fact that some large exporters went the extra mile and began to apply for loans to save its economy, writes CNBC.

Nigeria has applied for emergency assistance amounting to more than $ 7 billion from international creditors including the international monetary Fund (IMF), the world Bank, the African and Islamic development banks. According to the IMF, oil is 60 percent of the income of the country, although it accounts for only 9 percent of GDP. Fitch and S&P downgraded the credit rating of Nigeria in recent weeks amid falling oil prices. Under the agreement, OPEC+ Nigeria agreed to cut production from 1.8 million barrels per day to 1.4 million.

“the Economies of the West coast of Africa the most dependent on oil exports. Nigeria, Angola, Gabon, Republic of Congo would try to take the loans, but borrowers doubt that they will be able to give them,” — said in a research note NKC African Economics.

on Monday, the IMF announced the allocation of funding to Gabon in the amount of $ 147 million, and Saudi Arabia plans to use $ 32 billion of its cash reserves to cushion the economic blow from falling oil prices. Most of oil revenues depends on Iran (65 percent of GDP), followed by Kuwait (60 percent) and Saudi Arabia (50 percent). In Russia the share of oil in total income of the country is 40 percent and in exports — more than 66 percent. According to various forecasts, the fall in Russia’s GDP will be from 5 to 7.5 percent by year-end.

According to the IMF, global GDP will shrink by three percent in 2020 due to a record fall in oil prices and pandemics coronavirus. According to experts, more and more countries will not be able to service its debt in the next 12-18 months, which could lead to default. 20 April the price of the futures contract for the supply of a barrel of oil us WTI crude fell to minus $ 40. The fall in oil prices is happening despite the fact that from 1 may, 23 countries agreed to reduce oil production to 9.7 million barrels per day.