Determining the Impact of Nigeria's Economic Crisis on the Multinational Oil Companies: A Goal Programming Approach

Abstract

Traditionally, regression analysis has frequently been used in quantitative policy-impact analysis, but this paper utilizes goal programming methodology to examine the impact of Nigeria's economic crisis on the multinational oil companies in Nigeria. The results obtained indicate that, as the multinational oil companies are paid prices far below the world oil market prices, the current economic crisis in the country imposes losses on the companies and discourages large capital investment. In particular, the huge losses call for negotiation between the government and the multinational oil companies for better policy measures, such as a relaxation of the existing pricing policy, to reduce the losses resulting from the current economic crisis.