International Journal of Business and Management Review (IJBMR)

EA Journals

Effect of Liquidity Management On the Financial Performance of Nigerian Oil and Gas Firms


The Nigerian Oil and Gas industry, as a result of the COVID-19 pandemic, continues to be plagued with numerous economic challenges that affect its liquidity position and hinders it from delivering on its core mandate of profitability. Hence, the purpose of this research was to look into the effect of liquidity management on the financial performance of Nigerian oil and gas firms. Current Ratio (CUR), Quick Ratio (QUR), Cash Ratio (CAR), and Return on Capital Employed (ROCE) were explored as proxy variables for liquidity management and financial performance, respectively, using an ex-post facto research approach. The study used a purposive sampling approach to collect secondary data, which was based on the availability of data at the time of the investigation. These figures were collected from five Nigerian oil and gas firms’ annual financial reports, which spanned the years 2012 through 2021. The data was analyzed using descriptive statistics and regression analysis. Results from the analysis revealed that Quick Ratio and Cash Ratio has a positive insignificant impact on Return on Capital Employed while Current Ratio has a negative significant impact on Return on Capital Employed. Based on the findings, managers of oil and gas firms should adopt effective liquidity management policies that guarantee an optimal level of liquidity that improves its profitability and enables them operate with a reasonable margin of safety.

Keywords: Quick Ratio, and return on capital employed, cash ratio, current ratio

cc logo

This work by European American Journals is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 4.0 Unported License


Recent Publications

Email ID:
Impact Factor: 8.72
Print ISSN: 2052-6393
Online ISSN: 2052-6407

Author Guidelines
Submit Papers
Review Status


Scroll to Top

Don't miss any Call For Paper update from EA Journals

Fill up the form below and get notified everytime we call for new submissions for our journals.