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Major oil companies have asked local authorities to boost surveillance on oil-producing and oil and infrastructure assets in Nigeria amid escalating protests against police brutality and plans for oil job cuts, three industry sources told Reuters on Wednesday.
The protests and the expected job cuts are further aggravating the unemployment in the Niger Delta, Nigeria’s oil-producing region, and companies and non-profit organizations fear a spike in oil theft on pipelines.
The unemployment rates in Nigeria’s key oil-producing states in the Delta exceed 45 percent.
Nigerians have been protesting against the notorious Special Anti-Robbery Squad (SARS) unit for several weeks, calling for the authorities to disband it. Rights group say that the Nigerian army and police shot dead at least 12 peaceful protesters in Lagos last month. At times, protests across Nigeria turned into riots and looting.
The escalating tension in Africa’s top oil producer drew reaction from the U.S. State Department, with Secretary Mike Pompeo saying at the end of October that “The United States strongly condemns the use of excessive force by military forces who fired on unarmed demonstrators in Lagos, causing death and injury.”
The situation in Nigeria hasn’t spilled to its vital oil sector yet. The oil and gas industry accounts for around 10 percent of the country’s gross domestic product (GDP), while petroleum export revenue accounts for 86 percent of the total revenue from exports.
The protests add to plans by some oil majors to cut jobs in Nigeria, which makes the employment situation in the oil-producing regions even gloomier. Chevron has said it would cut 25 percent of its workforce in Nigeria.
Faced with even fewer job prospects, more people in the Niger Delta could turn to criminal activities such as tapping pipelines for oil and petroleum products to later sell them, observers and industry sources and analysts told Reuters, although they said the locals would not blow up pipelines.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.