The Managing Director of Legendary Foreshore, Victor Ameh, has warned that escalating tensions involving the United States, Israel and Iran could intensify economic pressures in Nigeria, despite creating short-term gains from rising oil prices.
Speaking in an interview with Leadership Newspaper, Ameh said growing geopolitical uncertainty in the Middle East is already unsettling global oil markets, with significant implications for Nigeria’s economic outlook in 2026.
He noted that although the conflict is geographically distant, its effects are being transmitted through higher energy prices, foreign exchange volatility and fiscal uncertainty in oil-dependent economies such as Nigeria.
According to him, oil prices have historically reacted sharply to instability in the Middle East, particularly when key producers or strategic shipping routes are involved. He explained that Iran’s position in the global oil supply chain, coupled with its proximity to the Strait of Hormuz, heightens the risk of supply disruptions whenever tensions escalate.
While higher oil prices could boost government revenues and provide temporary fiscal relief for Nigeria, Ameh cautioned that the benefits are not straightforward.
He explained that despite being a major crude oil producer, Nigeria still relies heavily on imported refined petroleum products. As a result, increases in global crude prices often translate into higher domestic fuel costs, thereby fueling inflation and raising the cost of living.
Ameh added that in the current economic environment—characterised by high inflation, currency instability and ongoing reforms—such external shocks could further complicate stabilisation efforts.
He also highlighted the implications for Nigeria’s real estate sector, noting that foreign exchange volatility remains a major concern closely linked to oil market movements. Fluctuations in global oil prices tend to affect the naira, which in turn drives up the cost of imported building materials and increases construction expenses.
According to him, developers are becoming increasingly exposed to global geopolitical risks, even when operating within domestic markets. Rising energy costs, he said, are compounding these challenges by increasing expenses related to power generation, transportation and logistics.
This trend is also affecting housing demand. As households spend more on essential items such as fuel and electricity, their capacity to afford rent or home ownership declines, thereby tightening the real estate market, particularly in higher-priced segments.
Ameh further noted that geopolitical uncertainty is shaping investor sentiment, with international investors typically adopting a cautious approach during periods of global instability. This, he said, could limit capital inflows into Nigeria’s real estate and infrastructure sectors at a time when funding is already constrained.
Despite the risks, he acknowledged potential upsides. Sustained high oil prices could strengthen Nigeria’s external reserves and boost government revenues, creating fiscal space for infrastructure investments that may support long-term growth in housing and logistics.
However, analysts warn that such gains depend largely on policy discipline and efficient resource management, noting that without structural reforms, temporary windfalls from higher oil prices may not translate into lasting economic benefits.
The development underscores Nigeria’s increasing exposure to global events in 2026, with sectors such as real estate—once largely driven by domestic factors—now significantly influenced by international conflicts, currency movements and external market shocks.
Ameh stressed that developers, investors and policymakers must adapt to a more complex operating environment, where decisions taken beyond Nigeria’s borders can directly affect project costs, financing conditions and consumer behaviour domestically.
