NIGERIA’s daily crude oil production dropped to 1.27 million barrels per day (bpd) in the second quarter (Q2) of the year compared to 1.33 million bpd production in the first quarter (Q1).
Checks on the Organisation of Petroleum Exporting Countries (OPEC) monthly oil market reports show that Nigeria produced 1.28 million bpd of crude oil in April, 1.25 million bpd in May and 1.28 million bpd in June, averaging 1.27 million barrels in Q2.
In Q1, the country produced 1.43 million bpd in January, 1.32 million bpd in February, and 1.23 million bpd in March, which averaged 1.33 million bpd in Q1.
Nigeria has consistently failed to meet the OPEC quota of 1.5 million bpd despite basing its crude oil production benchmark at 1.78 million bpd in its 2024 budget.
According to OPEC, its monthly data on Nigeria’s crude oil production represent direct communication with the Nigerian authorities.
Meanwhile, OPEC monthly oil market reports released on Tuesday, July 10 revealed that Nigeria’s average daily crude oil production for June rose slightly to 1.28 million bpd from 1.25 million barrels bpd in May.
The ICIR reports that proceeds from crude oil production are the major source of Nigeria’s foreign exchange earnings and buffer for its foreign reserve as many experts have maintained that oil resources must be protected at all costs.
It is the major revenue-earning source but not meeting up with the budgetary benchmark worsens the foreign exchange problems and lead to volatility in the Nigerian currency market.
The Nigerian government and its state-owned oil company, Nigerian National Petroleum Corporation Limited (NNPCL), have continuously blamed the inability to meet production quota on pipeline vandalism, militancy, and insecurity in the country.
Recently, the NNPCL said it had declared a state of emergency in the country’s oil and gas industry to increase crude oil production and grow its reserves but stakeholders anticipate that the NNPLC match words with actions.
The state of emergency was declared by the NNPCL Group Chief Executive Officer, Mele Kyari, on Tuesday, July 2, The ICIR reported.
“We have decided to stop the debate. We have declared war on the challenges affecting our crude oil production. War means war, Kyari said.
A detailed analysis of assets revealed that Nigeria can conveniently produce two million barrels of crude oil per day without deploying new rigs, the NNPCL boss asserted.
He, however, said that the major impediment to achieving it remains in the inability of players to act promptly.
“This is our major source of revenue for now and we need to guard it jealously. Our inability to meet up with our OPEC quota is a major concern. This is a major setback in having a maximum supply of dollars in Nigeria’s foreign exchange market,” Kyari lamented.
A recent analysis of crude oil production, from January to May, by The ICIR showed that Nigeria was losing over N16 billion revenue daily.