Nigeria continues to struggle to meet its OPEC’s quota as its crude oil production fell by 40,000 barrels per day in the month of September.
This is contained in a report by American media outlet, Reuters, on Thursday based on a survey of OPEC’s September output that is yet to be published.
The report also Indicates that other members of OPEC struggled with output in the month of September, particularly Libya which is currently faced with unrest disrupted in terms of supply.
The report also highlights that other OPEC members, particularly Libya, faced challenges with oil output in September, as ongoing unrest disrupted the country’s supply.
Nigeria which has been struggling to meet ramp up oil production to not only meet OPEC’s quota but also meet local demands for Nigeria’s refinery, has been hovering around 1.2 to 1.3 million barrels per day since the beginning of the year.
According to OPEC last report, Nigeria produced 1.35 million bdp as of August 2024.
OPEC Crude Oil Output for September
Generally, OPEC’s oil production dropped to 26.14 million barrels per day (bpd) last month, a decline of 390,000 bpd compared to August’s revised total, primarily due to Libya’s reduced output.
A standoff over control of Libya’s central bank significantly impacted its oil production, cutting supply by 300,000 bpd. This disruption pushed oil prices higher amidst concerns about global demand and increased non-OPEC supply.
Although Libya’s output is expected to rebound following the resolution of its central bank leadership dispute, Iraq recorded the next largest decline as it seeks to improve compliance with its OPEC target.
Despite this, Iraq still pumped 90,000 bpd above its quota. In contrast, Iran, exempt from OPEC’s production limits, saw a slight increase, reaching near its highest output since 2018, despite ongoing U.S. sanctions.
Overall, OPEC production remained about 130,000 bpd above target, largely due to Iraq’s excess output.
What you should know
Although the oil sector contributes only a small portion to Nigeria’s GDP, it remains a vital source of foreign exchange and government revenue.
Its importance stretches beyond economic figures, as it funds various government functions. Fluctuations in crude oil production heavily influence the country’s fiscal stability.
Increased production boosts revenue, supporting essential sectors like infrastructure, education, and health.
On the other hand, a significant decline in production can cause revenue shortfalls, potentially weakening an already fragile economy, as seen in recent years.