……. Promises that Nigeria will meet August production target
Nigeria’s Oil Minister, Mr. Timipre Sylva, has said that OPEC+ alliance of oil producers is actually running out of the capacity to pump more crude, and it includes its biggest member Saudi Arabia.
Speaking to newsmen last weekend in Abuja, the minister said people say, following rising oil prices, OPEC members should produce and supply more.
‘’Some people believe the prices to be a little bit on the high side and expect us to pump a little bit more but at this moment there is really little additional capacity,” said Sylva.
According to him, this is not withstanding the presence of Saudi Arabia, and Russia; of course Russia, is out of the market now more or less, he noted.
The perceived lack of spare capacity among many OPEC members has helped to keep oil prices high in recent months, despite lofty ambitions from the group regarding July production targets, which were set 648,000 bpd higher than their June targets and over a million bpd higher than the May targets—which they aren’t meeting either.
Over the last year the cartel has been boosting output in a series of planned increases. The group is expected to meet this next week Thursday to decide whether to proceed with a planned August oil production increase.
“At this moment I think the prices are firming up and I don’t think there will be any surprises in OPEC in August,” Sylva said.
In recent years, Nigeria has been struggling with declining production, owed to oil theft and pipeline vandalism, which contributed to reasons why many international majors are divesting their onshore and shallow-water fields to Nigerian independent producers for more than a decade.
Struggling even to meet the quota has been “very sad for us” and operators have planned to fill the gap within a couple of months, Sylva said.
“By end of August generally the commitment is that we’re at least going to produce our OPEC quota and then of course look at going even beyond that after August,” he said.
Nigeria’s crude production slipped in May—the last available data—to 1.262 million bpd. Its May production quota under the OPEC deal was 1.753 million bpd, a shortfall of nearly half a million barrels per day.
Vows by the Muhammadu Buhari administration to clean up the industry have failed to restore Nigeria’s crude production capacity to its full potential.
Assuring on the august promise, Sylva told the media conference, “We have given ourselves just about a month to ensure that we can … we believe that by August we would see some improvement in security,” Sylva added.
Observers say if Nigeria manages to meet its August production target, it would make a huge difference in the oil markets.
Be the first to know when we publish an update
