The International Monetary Fund (IMF) has cautioned that Nigerians could face more difficult economic conditions in the short term, as rising costs of food and transportation continue to put pressure on household incomes amid ongoing global uncertainties.

At the same time, the Fund highlighted concerns over Nigeria’s growing debt profile, even as increasing global oil prices offer prospects for higher government revenue. Nigeria’s crude grades, including Brass River and Qua Iboe, recently traded above $113 per barrel—significantly higher than the $60 benchmark set in the country’s 2026 budget. Analysts suggest that the ongoing geopolitical tensions, particularly involving the United States and Iran, could sustain elevated oil prices, potentially boosting Nigeria’s earnings.

Speaking during the World Bank/IMF Spring Meetings in Washington, IMF official Abebe Selassie noted that the crisis is already worsening living conditions, especially through increased transport fares and the rising cost of food. He explained that higher fuel and logistics expenses are directly affecting both urban and rural populations, making daily life more expensive.

Despite these pressures, the IMF urged governments, including Nigeria’s, to stay committed to ongoing economic reforms. Selassie emphasized that recent measures to stabilise debt and reduce fiscal deficits have provided some buffer against shocks, but warned against abandoning long-term policy goals. He advised authorities to prioritise essential spending, improve efficiency, and strengthen domestic revenue generation through better tax systems.

On debt sustainability, the IMF projected that Nigeria’s debt-to-GDP ratio could rise to 33.1 percent by 2027. While this figure may appear moderate globally, experts warn that the country’s limited revenue base makes debt servicing a major concern. The Fund also stressed the importance of maintaining fiscal discipline, avoiding excessive subsidies, and strengthening economic resilience through reforms, technology adoption, and improved trade integration.

Overall, while higher oil prices may provide temporary relief, the IMF maintained that Nigeria must carefully manage its finances and continue structural reforms to ensure long-term economic stability.