Again, Nigeria failed to ramp up crude oil production despite all the sloganeering by the various agencies of government, producing 558,000 barrels of the commodity less in April, compared with March.
The Organisation of Petroleum Exporting Countries (OPEC), which made this known in its Monthly Oil Market Report (MOMR) for May, noted that in April the country under-produced 18,000bpd versus the previous month of March based on direct communication.
For several months, Nigeria has failed to meet its OPEC quota, blaming massive oil theft, inability to restart oil wells shut down in the wake of the Covid-19 pandemic, lack of investment as well as community issues.
In the report which was released thursday by the Sanusi Barkindo-led organisation, it noted that whereas Nigeria drilled 1.238 million barrels per day in March, in April it fell to 1.219 million barrels.
This was also a far cry from February’s production figure which was 1.258 million barrels per day and the first quota’s average production which was pegged at 1.299 million barrels per day.
In the same vein, OPEC stated that while Nigeria’s private sector has continued to gain momentum this year, with the Stanbic IBTC Bank Purchasing Managers’ Index (PMI) rising to 55.8 per cent in April from 54.1 per cent in March, yet rising insecurity might still pose a challenge and weigh on economic activities.
In addition, OPEC listed domestic supply chain disruptions, localised food shortages and inflationary pressures – driven by both local and global factors as problems that the country needs to tackle.
Meanwhile, slower global economic growth, China’s fight against Covid-19, and the Russian invasion of Ukraine has prompted OPEC to slash for a second month running its global oil demand growth estimate for 2022.
OPEC revised down its forecast for global economic growth and said oil demand would grow by 310,000 barrels per day less than the growth anticipated in the April report.
Back in April, OPEC slashed its oil demand growth estimate for 2022 by 480,000 bpd on the back of lower expected global economic growth with the Russian war in Ukraine and the return of COVID lockdowns in China.
In this month’s report, the cartel cut its world economic growth estimate to 3.5 per cent from 3.9 per cent having revised down in April its global growth forecast to 3.9 per cent from 4.2 per cent.
“The upside potential to the current forecast is quite limited. However, it may come from a solution to the Russia and Ukraine situation, fiscal stimulus, where possible, and a fading pandemic, in combination with a strong rise in service sector activity,” OPEC projected.
Concerning the global oil demand, OPEC forecast a growth of 3.36 million bpd in 2022 compared to 2021, down by 310,000 bpd from last month’s estimate.
Yet, overall, global oil demand is still set to average above 100 million bpd this year, at 100.29 million bpd, per OPEC’s latest forecast.
The second-quarter demand estimate was revised down by a massive 670,000 bpd to 98.44 million bpd, but average global oil demand is set to exceed the 100 million bpd mark in the third and fourth quarters, with Q4 demand seen at 102.64 million bpd, OPEC stated.
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