Nigeria accepts more than £1bn UK aid, while its corrupt officials allow £2bn of oil to be stolen every year Nigeria has accepted more than £1billion in UK aid, despite losing twice that sum every year through its corrupt oil industry, it has been revealed The aid may not be going to those who need it most, with some being used to equip the country's navy Tory backbenchers have criticised Prime Minister David Cameron's commitment to increased aid spending Nigeria has accepted more than £1billion in aid from Britain while losing twice that sum every year through corruption in its oil industry, it was revealed yesterday. Some 100,000 barrels of oil a day are being stolen from pipelines, ports and storage tanks with the connivance of politicians, officials and military top brass, says an authoritative report. It also points out that the aid to Nigeria may not be going to those who need it the most. In fact, some of it is being used to equip the country's navy. The stolen crude oil represents five per cent of all production in oil-rich Nigeria. Nigeria has accepted more than £1billion UK aid, despite losing twice that sum every year through corruption in its oil industry. Above, the Total Nigeria onshore oil and gas refinery at Amenam in the delta of the Niger River in Nigeria The report by the think-tank Chatham House said the proceeds of the theft are then laundered in major financial markets, with the City of London key among them. It warned that the scale of the stolen oil trade "threatens the integrity of financial markets and the legitimate oil business." Nigeria's share of the aid was questioned last month after the Mail disclosed the country's plans to expand its space agency (above) The report comes at a time of growing controversy over Britain's foreign aid budget, which is due to rise to £11billion a year in 2015. Questions over Nigeria's share of the aid - £1.14 billion over the five years - were raised last month after the Mail disclosed the country's plans to expand its space agency and put an astronaut in space in two years. The inquiry by Chatham House - established for almost a century with close links to the Foreign Office - throws further doubts over the fate of aid money sent to Nigeria. The report, Nigeria's Criminal Crude, said the cash is going to pay for Nigerian naval equipment and training at a time when the country's maritime forces have conspicuously neglected to attempt to stop shipments of stolen oil. It said foreign oil workers have watched as tankers known to be loaded with illicit cargo have sailed past patrol vessels unmolested. Tory backbenchers have been fiercely critical of David Cameron's commitment to increased aid spending. They believe much of the cash amounts to subsidies for rich people in developing countries at the expense of the British poor. The Chatham House report said: "Nigerian crude oil is being stolen on an industrial scale. Proceeds are laundered through world financial centres. In Nigeria, politicians, military officers, militants, oil industry personnel, oil traders and communities profit, as do organised criminal groups. Some 100,000 barrels of oil a day are being stolen from pipelines, ports and storage tanks with the connivance of officials, says an authoritative report. Above, oil pipelines in Port Harcourt, Nigeria The greatest victims are ordinary Nigerians. The trade destroys the environment, weakens public institutions, swallows government revenue that could buy public goods, and imposes other social costs. Britain is named as a "hotspot" where the profits are laundered. The process involves "bulk cash smuggling ... heavy use of middlemen, shell companies and tax havens, bribery of bank officials, cycling cash through legitimate businesses and cash purchases of luxury goods." The reported scale of the stolen oil trade is said to be 100,000 barrels a day, worth more than £6million. That means the illicit industry is worth well over £2billion each year. The Department for International Development, which administers the aid budget, said Britain was working to fight corruption in Nigeria.