The latest data from the Organisation of Petroleum Export Countries (OPEC) crude oil production for January reveals that Nigeria averaged around 1.427 million barrels of crude oil daily- far below the 2024 budget target of 1.78 million barrels of daily production.
According to the report, Nigeria’s crude oil production for January saw an increase of 91,000 barrels when compared to the 1.33 million barrels daily production recorded in December.
OPEC stated that the figures were obtained from direct communication with operators in the country.
However, based on secondary data obtained by the cartel, Nigeria’s average daily crude oil production stood at 1.419 million barrels daily- a drop of around 3000 barrels compared to the 1.422 million barrels recorded in the previous month of December.
Global crude oil production for the month
In total, members of the OPEC cartel produced around 26.34 million bpd for January. Although, the figure represents a decline of 350,000 barrels daily when compared with the total production for the previous month.
The report further noted that world oil supply for the month dropped by 0.6 million barrels daily to around 101.8 mb/d.
Nigeria’s quest to raise crude oil production
- In the past few years, Nigeria have seen a decline in crude oil production occasioned by rampant theft, divestment by oil majors in onshore fields and lack of investment in the industry.
- However, the administration of President Tinubu has promised to restore confidence in the industry and achieve a crude oil production target of 4 million barrels daily by 2030.
- In the 2024 budget, the federal government set a benchmark production target of 1.78 million barrels of oil daily to achieve revenue projections. Also, the federal government projected the benchmark price of crude oil in the budget at $77.96. The average price of crude oil for January stood at $80.12 slightly above Nigeria’s benchmark price.
- Failure to meet the oil production target poses a threat to the implementation of the budget for the year as it leads to revenue shortfalls.
- Nigeria received its first dent to the budget benchmark in December when the oil cartel OPEC reduced its production quota to 1.5 mbpd from around 1.7 mbpd prior.