State, Conflict and Political Economy of Oil in Nigeria

Abstract

This thesis explores the nature, cause and dynamics of the conflict in the oil-rich Niger Delta region of Nigeria. The region has become a hot spot for increased oil insurgency and well-organized criminal activity in the wake of the 1999 transition to democratic rule. The main contribution of this study lies in its use of the political economy theory of the state and the post-colonial characterization of the Nigerian state to analyse and explore specific role of the Nigerian state in the oil conflict. The research critiques past studies in the field as “grand narratives” based on assumptions of international political economy of resource conflicts not least the rentier state and resource curse theses. Through a case study of the state-owned oil industry the Nigerian National Petroleum Corporation (NNPC) and Vanguard Newspaper representing a section of the media the thesis problematized the oil conflict in the Niger Delta to failure of democratization to address decades of conflict, politicization of ethnicity, descent to terminal spoils via oil bunkering and flaws in the country’s federalism. The study critically interrogates the legal/institutional as well as militaristic response of the state to the conflict as state-centric and factors spurring the conflict.

The findings reveal that the conflict is rooted in factors affecting the control, management and distribution of oil resources by a centralized federal structure characterized by a failure of governance. In other words, the conflict dynamics of the Delta is explained by total failure of oil-wealth to foster development. Instead, it impedes political development, generates conflict over resource distribution, fuels ethnic conflict and fragmentation, and institutionalized corruption all spawned by rise in government oil largesse. Since the return of democracy in 1999, lack of genuine democratization in Nigeria, has crippled even nascent attempts at reform resulting to socio-economic stagnation, which relates directly to the rising trend of violence in the region. One of the key contributions of the study also is through an analysis of “illegal oil bunkering” as an empirical case of how legal/institutional failure of the state to response to the crisis and a reflection of descent to terminal spoil in the Nigerian oil industry led to spoils of oil violence. The research critically examines how oil bunkering has damaged the environment through oil spillage and contributes to proliferation of small arms and light weapons in the region. Finally, the thesis also suggests that, the potential solution to the Niger Delta crisis lies in governance and constitutional reform that focuses on correcting the structural imbalances embedded in the nature of Nigerian fiscal federalism, its revenue allocation formula and to effectively fight corruption at all levels of governance. The Nigerian state should also abrogate or review specific oil-related laws that serve as a fault-line of conflict with the oil producing communities. Failure to tackle this problem will allow the self-destructive cycle of violence to continue to undermine reform initiatives and perpetuate the region’s instability.