- The Washington Times - Sunday, January 29, 2012

U.S. officials are monitoring developments in Nigeria, where massive protests and a series of bombings by a shadowy Islamist group have rocked the West African nation, a key U.S. oil supplier.

Concerns about the security situation facing President Goodluck Jonathan mounted after a series of coordinated suicide car bombings targeted police stations in the northern city of Kano this month.

State Department officials and regional analysts are downplaying the likelihood that the violence will interrupt crude oil exports, noting that the unrest centers on a region far from the oil facilities along Nigeria’s southern coastline.

U.S. and Nigerian officials engaged in high-level talks last week in Abuja, the Nigerian capital, with a focus on how Mr. Jonathan’s government “can improve its security response” to the threat posed by the Islamist group Boko Haram, a State Department spokeswoman said.

On Sunday, Boko Haram militants ruled out talks with the government and threatened more attacks in Nigeria.

Nerves have been raw since the Jan. 20 bombings killed an estimated 185 people. The explosions hit just days after widespread demonstrations and the threat of a nationwide labor union strike nearly brought the country to its knees.

Analysts have been careful to isolate the Islamist violence from the protests, which have been embraced by a broad cross-section of Nigerians.

Nonetheless, a two-pronged crisis is harrying Nigeria as it struggles to overcome crushing poverty and a tense divide between the predominantly Christian south and the mostly Muslim north.

Social frustrations were running high long before Mr. Jonathan, a Christian from the oil-rich southern Niger Delta region, rose to power last year.

About 70 percent of Nigerians live on no more than $1.25 a day. Though the nation is Africa’s leading oil producer, it must import gasoline because its own refineries have collapsed as a result of widespread corruption.

Public anger boiled over this month when Mr. Jonathan, under budgetary duress, abruptly removed government subsidies for fuel, which sent gas prices soaring from about $1.70 to $3.50 per gallon.

The president was forced to reinstate the subsidies at the threat of a nationwide labor strike that likely would have crippled the oil export industry.

With gas prices down again and protests subsiding, the Jonathan government felt it had dodged a bullet. Then the Dec. 20 bombings hit, and a fresh wave of unease washed over the country.

The blasts put the spotlight back on Boko Haram, which is rooted in the mainly Muslim north. The group has been the focus of growing international concern since claiming responsibility for a similar bombing that killed 18 people at the U.N. headquarters in Abuja in August.

The threat to Nigeria’s stability, meanwhile, has become an issue of increasing interest amid shifts in the world’s crude oil market.

With the European Union agreeing to join a U.S.-led boycott of crude produced by Iran, analysts point to the opportunity, as well as the possible need, for others to increase production.

The fifth-largest oil provider for the U.S., Nigeria delivered about 850,000 barrels a day last year. It supplies U.S. refineries with about 9 percent of their daily crude intake.

The country’s potential to play a bigger role in global oil markets likely bolsters U.S. eagerness to help Mr. Jonathan prevent a security meltdown.

Nigeria is the African country of greatest strategic importance to the United States, and therefore we have to be concerned about the stability of its government,” said John Campbell, a senior fellow at the Council on Foreign Relations who served as U.S. ambassador to Nigeria from 2004 to 2007.

While “stability is being challenged right now by Boko Haram,” Mr. Campbell said, the threat can be overcome and could carry on in its current form for “quite some time” before Nigeria’s oil industry is at risk.

He added that the Boko Haram threat differs significantly from what disrupted Nigerian oil output four years ago, when militants from the mainly Christian southern delta forced the shutdown of an offshore Shell platform with a brazen, nighttime speedboat raid.

Such disruptions ended in 2009, when President Umaru Musa Yar’Adua, a Muslim, cut a deal with the southern militants that involved significant payoffs and amnesty.

The southern militants have not presented problems for Mr. Jonathan, but they have threatened to resume attacks on the oil industry should the government try to cut a similar amnesty deal with northern groups such as Boko Haram.

Mr. Jonathan signaled a desire to negotiate with Boko Haram last week, calling on the group publicly to identify itself and state its demands.

While such developments are playing out, some analysts say the greatest threat to Nigeria’s oil industry is posed not by militant groups but searing public frustration over poverty and the government.

“The main challenge to Nigeria’s oil exports would be in the event of a confrontation between the government and the public over the lifting of the fuel subsidy, particularly if that provoked the oil unions to strike,” said Peter Lewis at Johns Hopkins University’s School of Advanced International Studies.

“If the powerful unions in the petroleum sector go on strike, they could shut down the oil supplies,” Mr. Lewis said.

“Even then, it’s likely that it would be short action, but the oil futures markets would register, and it would probably dramatically boost prices.”



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