Nigerias Oil earnings rise by N188.71bn as output appreciates

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Nigeria’s revenue from sale of crude oil (excluding condensates) increased by N188.7bn in August 2023, following a marginal gain in the production of the commodity by both international and indigenous operators in the sector.

Data obtained from the Nigerian Upstream Petroleum Regulatory Commission and the Organisation of Petroleum Exporting Countries confirmed that oil output from Nigeria appreciated in August, as against what obtained in the previous month.

It was observed that in August, the country pumped a total of 36,615,125 barrels of crude oil (excluding condensates), which was higher than the 33,761,767 barrels produced in the preceding month of July.

This indicated that oil production in August was higher than what was produced in July by 2,853,358 barrels.

Data from the World Bank showed that the average cost of Brent, the global benchmark for crude, in August 2023 was $86.16/barrel.

Also, figures from Exchange Rates UK, a global analytical firm, put the average exchange rate of the United States dollar in Nigeria in August at N767.6.

Therefore, by producing an additional 2,853,358 barrels of crude oil in August, Nigeria’s oil earnings rose by about N188.71bn in the review period.

On daily production figures for crude, OPEC stated that oil output from Nigeria increased to 1.181 million barrels per day in August this year.

In its just released monthly oil market report for September 2023, the global oil cartel said oil production in Nigeria rose from 1.081mbpd in July to 1.181mbpd in August.

The country had produced 1.18mbpd in May, which was higher than the 0.99mbpd production figure recorded in the preceding month of April.

Data from the OPEC report, however, showed that though the country’s oil output appreciated in August, it was still lower than the 1.249mbpd recorded in June this year.

A further analysis of the report indicated that the country pumped an average of 1.144mbpd in the second quarter of 2023, which was lower than the 1.277mbpd output recorded in the preceding quarter.

Nigeria’s oil output had been nosediving lately, despite the marginal rise in August. Operators have called for concerted efforts to boost oil output in order to gain more foreign exchange for the country.

The President, Petroleum Products Retail Outlets Owners Association of Nigeria, Billy Gillis-Harry, had told our correspondent that the drop in oil output posed a dangerous sign.

He said, “That is a very dangerous signal of trouble that is coming. This is because we thought that with what the Tompolo team is doing, we should be approaching about two million barrels of crude oil production per day.

“So if the volume of reduction is this frightening, then it is something that calls for urgent investigation. It portends an economic downturn that could be drastic if the situation continues. However, I believe that with all of these new oil discoveries in Nasarawa and Bauchi, and production commencing, there may be a positive change.”

The Executive Secretary, Major Oil Marketers Association of Nigeria, Clement Isong, had called on the Federal Government to work hard and stop crude oil theft.

He said oil theft was not only stopping Nigeria from meeting its production quota as approved by OPEC, but was denying the country a lot of dollars required for the imports of goods.

“The I&E (Importers and Exporters) window is illiquid. There’s no money there. To buy products (fuel), it costs you between $25m to $30m. You can’t find it in the I&E window. So it doesn’t work and that is why people are not importing.

“You can’t access the dollar, you can’t find it right now. Nigeria has to sort out the security issues in the Niger Delta so that we can increase our daily crude oil output.

“If we increase it to 1.8 or two million barrels per day, then there’ll be dollars in the market. So we need to stop oil theft.”

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