[1902] Environment Variables Not Working on Now/Zeit Deploys

Using the latest Nuxt starter kit (1.0.0-rc11), I tried testing environment variables on Zeit's Now deployment services and it's not working.

nuxt.config.js

  env: {
    apiUrl: process.env.API_URL || 'http://local.dev/api'
  }

On deployment, it's never setting apiUrl to the environment variable API_URL.

I have verified that the environment variables work in a basic app that is deployed with Now, so I think there is something weird going on with Nuxt.js and Now, or perhaps something SSR related that I'm unaware of?

The environment variables work when I deploy a static site to netlify though.

Any ideas?

It's pretty easy to reproduce, just install the latest nuxt.js starter kit, add an env var and then deploy with Now.