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Nigeria’s potential crude oil reserves expected to fall by 6 billion barrels

The company expects potential reserves in Nigeria to fall further by 6 billion barrels.

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Norwegian independent energy research firm, Rystad Energy has published its annual global energy outlook for 2020. The company expects potential reserves in Nigeria to fall further by 6 billion barrels.

Rystad in its report says that COVID-19 pandemic which is being experienced globally will affect the demand for oil and thus, put a lid on exploration in remote offshore areas, further reducing world’s recoverable oil by around 282 billion barrels.

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“In Nigeria, after a decade long debate on oil policy reforms, potential reserves are expected to fall further by 6 billion barrels,“ the report said.

READ ALSO: Further oil production cut required to keep oil price above $40 in 2020 

For North Africa, Rystad expects production to fall further by 4 billion barrels in Libya due to no imminent peace in the country, while in Algeria, shale exploration potential is expected to reduce by 7 billion barrels.

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For North Africa the company expects production to fall further by 4 billion barrels in Libya due to no imminent peace, while Algeria Shale Exploration potential is expected to reduce by 7 billion Barrels.

“OPEC countries are expected to lose 21 billion barrels of reserves potential as the negative developments in Venezuela and Iran outweigh the increased strength and reserves potential of core OPEC countries in Arab Gulf region,” Head of Analysis, Per Magnus Nysveen said.

READ MORE: E-commerce platform, MaxAB, secures $6.2 million in seed funding 

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“Non-OPEC countries account for the lion’s share is lost recoverable resources with more than 260 billion barrels of undiscovered oil now more likely to be left untouched,” Nysveen added.

The firm foresees Saudi Arabia to be the clear winner of the OPEC+ agreement, and expects the oil-rich nation to add 25 billion barrels to future production.

Rystad Energy releases its annual outlook following the publication of the BP Statistical Review to provide an independent, solid and clear comparison of how the year has changed the world’s energy landscape.

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Commodities

Crude oil prices drop, major oil powers to ease record oil supply curbs

Brent crude lost about 0.59%, to trade at $43.52 per barrel by 05.33 am GMT.

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Brent crude drops to $25, oil demand drops by about 10% of world’s consumption, Brent Crude Oil hits $26, as Nigeria's Sweet Crude demand falls, Oil price pushes up before OPEC meeting, Asian equity markets mixed, NIGERIA OIL: Darker days ahead as Brent falls below production cost, Brent crude drops, as oil traders focus on OPEC+ meeting

Crude oil prices dropped on Thursday morning at London’s trading session, after OPEC’s leading allies agreed to alleviate record supply curbs of crude from next month. Although the plunge in crude oil prices got softened by the recent drawdown in U.S crude oil inventories.

Brent crude lost about 0.59%, to trade at $43.52 per barrel by 05.33 am GMT, and West Texas Intermediate (WTI) crude lost about 0.72%, to trade at $40.90 per barrel.

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READ MORE: Avoiding or mitigating recession in post COVID Nigeria – Olisa Agbakoba

The Organization of the Petroleum Exporting Countries (OPEC) and its allies have agreed to increase crude oil supply starting from next month, as demand continues to rise to pre-pandemic levels.

OPEC+ agreed to reduce the daily production cut from 9.6 million barrels a day to 7.7 million barrels a day from August. The reduction in cuts was backed by both Saudi Arabia and Russia, including other participating oil ministers in the virtual conference.

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“Some investors took profits after the OPEC+ decision, but a big draw in U.S. crude provided some support,” Kazuhiko Saito, chief analyst at Fujitomi Co said.

READ MORE: Why Nigeria’s banking stocks performed well in May

In addition, Stephen Innes, Chief Global Market Strategist at AxiCorp, in a note to Nairametrics, spoke about the sentiments oil traders are presently having. He said:

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“Despite the increase in COVID-19 cases and lockdown restrictions in individual states, US oil demand recovery continues.

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“Traders expect the market to tighten over the second half of 2020, so the peak for US oil inventories may be behind us. However, there is a risk that the restart of shut-in wells could put upward pressure on US crude stocks in the near term.”

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Commodities

OPEC launches Annual Statistical Bulletin (ASB)

The ABS would be a platform for reliable research data for analysts and policy stakeholders. 

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OPEC, Historic OPEC+ oil deal still under threat as negotiations drag, New OPEC+ output cut proposal stalls due to Russia, OPEC launches Annual Statistical Bulletin (ASB)

The Organization of Oil Exporting Countries (OPEC) has launched a bulletin to track data statistics of its members in the industry and other key economic indicators.

OPEC says that the ABS would be a platform for reliable research data for analysts and policy stakeholders.

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“The Annual Statistical Bulletin (ASB) contains about 100 pages of tables, charts and graphs detailing the world’s oil and gas reserves, crude oil and product output, exports, refining, tankers, plus economic and other data” the body said.

Comprising of important current time data of the oil production industry, from production to demand and import/exports, including oil transport tracking.

OPEC announced the initial launch report will provide data on oil and gas activities of 13 countries including Nigeria and Algeria, Angola, Congo, Equatorial Guinea, Gabon, IR Iran, Iraq, Kuwait, Libya, Saudi Arabia, the UAE and Venezuela.

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OPEC announced that the ASB would come with an interactive version on iOS and Android to optimize the valuable research data on the platform.

READ MORE: OPEC production output now at lowest level in nearly 30 years

OPEC Secretary-General, Dr Mohammed Barkindo said the body is dedicated to high-quality data transparency to provide timely oil and gas metrics for analysts.

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“This underpins OPEC’s overarching goal of fostering sustainable oil market stability for the benefit of producers, consumers and the global economy,’’ he added.

OPEC’s Head of Data Services Department, Ms Boshra AlSeiari, provided timely data from the ASb saying global demand grew 0.9% year on year with an average of 99.67 Million BPD in 2019, adding that the largest growth came from Asia (China and India in particular), Africa and the middle east.

“Total world crude oil production declined in 2019 by 0.56 million barrels/day (mb/d), or 0.7%, as compared to 2018, to average 75.26 mb/d, following a historical high during 2018.

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“OPEC crude oil production declined sharply year-on-year by 1.86 mb/d, or 6.0% while crude production by non-OPEC countries grew by 1.30 mb/d, or 2.9 per cent.

 “OECD oil demand fell slightly in 2019, while oil demand in OPEC member countries returned to growth in 2019,’’ AlSeiari said.

She also added that total exports from members averaged 22.48 million barrels per day in 2019, decreasing 7.4% from 2018 by 1.80 million barrels per day. She added that oil reserves of OPEC nation increased 3.7% in 2019 to 1,227 billion barrels and capacity to refine grew by 1.21 million barrels per day at 100.98 million by 2019.

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 “World proven crude oil reserves stood at 1,551 billion barrels (bn b) at the end of 2019, increasing by 3.6% from the level of 1,497 bn b recorded at the end of 2018,” she said.

 

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Commodities

Crude oil futures gain as U.S crude oil inventories drop

OPEC+ is expected to further step up oil production cuts beyond the July expiry date.

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Crude oil prices slump, as partial lockdowns resume

Crude oil price gained some ground on Wednesday morning, with oil traders’ positive sentiments heightened after the world’s largest consumer of oil reported a significant decline in its crude oil inventories, yesterday.

The American Petroleum Institute (API) estimated an 8.322 million-barrel draw for the week ended July 10. The draw was bigger than analysts’ forecasts of a 2.1 million-barrel draw, and reversed the previous week’s 2 million-barrel build.

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Brent crude gained about 0.42% to $43.08 at 5.30 am local time. Also, the other international benchmark for oil, the West Texas Intermediate, gained 0.45% to trade at $40.47.

READ ALSO: Nigeria only hit 56% of its target revenue in first five of months of 2020 

Amid the worsening COVID-19 situation globally, OPEC+ is expected to further step up oil production cuts beyond the July expiry date.

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Stephen Innes, Chief Global Market Strategist at AxiCorp, in a note to Nairametrics, spoke about efforts being made by the Saudis to ensure a smooth OPEC+ meeting scheduled for today. He said:

“However positive for oil prices is that Saudi Arabia is laying the foundations for a relatively smooth OPEC+ meeting on Wednesday with a joint statement released from the Saudi Arabian and Iraqi Energy Ministries, complementing Iraq for progress implementing production cuts.

READ ALSO: Global oil prices drop after reports of unexpected inventory build

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“At the same time, Saudi Arabia’s energy minister has also had a discussion with his Nigerian counterpart, following which Nigeria said it would compensate through September for producing over its agreed quota in May and June.”

READ MORE: What is holding oil price?

OPEC+ is scheduled to meet later today to discuss the future level of production in crude oil. The meeting will decide whether to extend output cuts of 9.7 million barrels per day (bpd) due to end in July, or decrease the cuts to 7.7 million barrels per day.

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