Nigeria’s average crude oil production for the month of April marginally rose to 1.281 million barrels daily according to the Organization of Petroleum Exporting Countries (OPEC) monthly oil market report for April.
According to direct sources from the federal government, daily crude oil production increased by 51 thousand barrels from 1.231 million barrels per day to 1.281 mb/d.
However, data from secondary sources to the oil cartel reports a decline in average daily oil production by 46 thousand barrels from 1.4 million barrels daily to 1.354 million barrels per day.
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Crude oil production by OPEC members
As per secondary sources, the 12 members of the oil cartel produced 26.58 million barrels per day- a decline of 48 thousand barrels compared to the production in March. In the month, crude oil production mainly increased in Congo and Iran while Nigeria, Iraq and Venezuela saw decreases.
Non-OPEC members
The other supporters of the oil cartel mainly led by Russia during the month recorded an average daily oil production of 14.44 million barrels daily. When compared with the previous month, there was a decrease of 198 thousand barrels. Among this group, Bahrain increased her oil production while Russia and Kazakstan reported decline in oil production.
What you should know
Despite the marginal increase in crude oil production, it still falls below the production quota set by OPEC and daily production target as reported in the 2024 budget. In the first quarter of the year, Nigeria consistently failed to meet its OPEC daily production quota of 1.5 million barrels per daily and even the higher target of 1.78 million bp/d proposed in the 2024 appropriation bill.
- In the first quarter of the year, average daily production stood at 1.327 million barrels- about 180 tb/d shy of the quota set by the oil cartel.
- The consistent inability of the country to meet its OPEC quota and budget proposal target has negative effects on revenue generation, foreign exchange stabilisation, overall budget performance and foreign reserve position.
- In the first three months of 2024, the foreign exchange market saw significant volatility with the naira depreciating from just under N1000/$ at the close of 2023 to N1309/$1. However, during this period, the market saw wild swings with the naira once trading on the parallel market at N1,800/$.
- On the budgetary front, the International Monetary Fund (IMF) had projected a higher budget deficit on the back of the failure of the authorities to meet its production targets despite elevated crude oil prices.
- It stated, “Staff projects a higher fiscal deficit than anticipated in the 2024 budget, but broadly unchanged from 2023. The drivers are: (i) lower oil/gas revenue projections, reflecting IMF oil price forecasts but incorporating recent production gains;”
