OPEC’s monthly oil market report that for the month of February, Nigeria’s crude oil production dropped by 104,000 barrels per day from 1.42 million barrel to 1.32 barrel per day. This report is base on direct communication from Nigeria to OPEC’s authorities.
Base on secondary sources, Nigeria recorded a daily crude oil production of 1.47 million barrel for February. This represent an increase of 47,000 barrels of oil per day.
It was shown in the report that the global oil production for 2024 from non-OPEC producers is expected to grow by 1.1 million barrels daily while that from OPEC countries is projected to grow by 64,000 barrels daily averaging around 5.5 million barrels for the year.
The oil production from OPEC countries increased by 203,000 barrels daily to reach around 26.5 million barrels daily for February according to data from secondary sources.
“OPEC-12 crude oil production in February increased by 203 tb/d, m-o-m, averaging 26.57 mb/d, as reported by available secondary sources.”
Saudi Arabia increased its oil production for the month by around 55,000 barrels daily despite the commitment to cut down oil production. It also continued its unchallenged position as the largest oil producer in the world with around 9.01 million barrels daily.
In the February, oil prices rose by around $1.19, or 1.5% to an average of $81.23/barrel according to OPEC’s reference basket. Brent crude went up by 3.2% to average around $81.72/barrel while NYMEX WTI futures contract rose by $2.75 to average $76.61/barrel.
The drop in crude oil production for February makes it the second consecutive month in the year that the country has failed to meet the target crude oil production benchmark in its 2024 budget and also its production quota as stipulated by OPEC. For 2024, Nigeria proposed a daily crude oil production of 1.78 million barrels while OPEC pegged its production at 1.5 million barrels daily.
“Reduced crude oil production dents the federal government’s plan to raise revenues to execute its budget. It also negatively affects the ability of the CBN to increase FX liquidity to shore up the value of the naira”.
“Last week, President Tinubu signed a slew of executive orders geared towards making the Nigerian oil industry more attractive to investors. Chief among them was the executive order to reduce contract cycles to six months max and the provision of specific financial incentives for deepwater investments etc”.
