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The nation’s oil production rose by 63,000 barrels to 1.42 million barrels per day in February based on figures obtained from direct communication – as hinted in the report.
Platts Analytics had predicted that Nigeria’s crude production would grow from 1.4 million barrels in December 2020 to over 1.7 million barrels in April 2021 and then stay at around 1.9 million barrels in the second half of the year.
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But OPEC’s secondary sources said Nigeria produced an average of 1.49 million barrels in February, reflecting 161,000 barrels per day increase when compared to 1.33 million barrels in January.
OPEC publishes two figures for its 13 -member nations’ oil production in its ‘Monthly Oil Market Report’ to ensure member countries are not producing oil beyond their agreed target. This is meant to shore up prices in the global oil market.
The first is based on direct communications which are figures obtained from member countries directly while the second is from independent secondary sources estimated by a network of individual spotters who monitor the movement of tankers in and out of the world’s biggest export terminals to estimate production levels.
According to secondary sources, OPEC’s total crude oil production averaged 24.85 million barrels per day in February 2021, down by 0.65 million barrels per day on month-on-month basis.
“Crude oil output increased mainly in Nigeria, Iraq, Iran IR, Venezuela and Libya, while production decreased primarily in Saudi Arabia and Angola,” the report read.
It also noted that as the COVID-19 pandemic had a major impact on the oil market balance, OPEC, together with its non-OPEC partners in the Declaration of Cooperation, took a historic step to help stabilise the oil market.
“This proactive stance turned out to be a very important element in supporting global economic growth, after an estimated drop in oil demand of 9.6 million barrels per day in 2020.
“Oil demand is forecast to recover in 2021, growing by 5.9 million barrels per day. However, this year’s demand growth will not be able to compensate for the major shortfall from 2020, as mobility is forecast to remain impaired throughout 2021,” the statement pointed out.
According to the group, non-OPEC supply was expected to have declined by 2.6 million barrels per day in 2020, while the growth of 0.95 million barrels per day was anticipated for 2021.
OPEC and its allies had initially agreed to cut oil production by a record of 9.7 million barrels per day last year, before easing cuts to 7.7 million and eventually 7.2 million from January.
“However, as the impacts of COVID-19-related developments remain uncertain, continued responsible global policy action from all market participants, including the efforts undertaken by OPEC and the participating non-OPEC producers of the DoC, will continue to be crucial over the coming months to return markets to more stable conditions,” it added.
The group, at its 14th meeting on March 4, extended special thanks to Nigeria for achieving full conformity in January 2021 and compensating its entire overproduced volumes.
The ministers thanked the state minister for petroleum resources Timipre Sylva for his shuttle diplomacy as a special envoy to Congo, Equatorial Guinea, Gabon and South Sudan to discuss matters pertaining to conformity levels with the voluntary oil production adjustments and compensation of over-produced volumes.
They agreed to the request by several countries, which had not yet completed their compensation, for an extension of the compensation period until the end of July 2021.
The global oil cartel also approved the continuation of current production levels for April, except that Russia and Kazakhstan would be allowed to increase production by 130,000 and 20,000 barrels per day, respectively.