Problems with being an oil producing nation

Posted by Felix Okoli on Saturday April 19, 2014 at 8:57:26:

Oil producing nations are countries that are naturally endowed with crude oil. The crude oil is drilled out and refined to create other finished products such as kerosene, fuel, diesel, and natural gas.

Due to the importance of crude oil in the world today, most countries really wished to have this natural gift from nature, but there are some problems with some oil producing nation such as Nigeria as facing for being an oil producing country, some of these problems include:

- Over-dependence on oil: The major problem of being an oil producing nation is that the country will depend solely in oil for it’s economic income. This problem is currently faced by Nigeria today. Before oil was found in Nigeria, Nigerian’s major means of economic income was Agriculture. Nigeria was nation strong in agriculture production and cash crop export. But since oil was discovered in Nigerian, the booming agricultural sector has been totally abandoned and the country is solely dependent on crude oil for it national income. This is a problem because a country should have at least two other means of national economic and not being dependent on just one.

- Stealing of public funds: An oil producing country with a bad government will have sections problem with looting. This looting means that government officials who are appointed by the people to represent their affairs are only interested in looting oil money, and acquiring oil wells, leaving the masses in poverty. This is the reason why you will see a country rich in oil but its citizens are living below poverty level.