Nigeria made the biggest oil production cut among members of the Organization of Petroleum Exporting Countries (OPEC) in March, reducing output by 50,000 barrels per day.
According to a Bloomberg report, Nigeria made the cut to maintain an average of 1.5 million barrels per day, in line with its OPEC quota, as the cartel urged tightened quotas among its members.
According to a Bloomberg survey, OPEC reduced overall production by 110,000 barrels per day in March.
Cut due to explosion at Trans-Niger pipeline
The report notes that the cut in Nigeria’s production follows delays in loading Bonny Light crude due to the recent explosion at the Trans-Niger Pipeline.
The pipeline, which is a critical infrastructure for Nigeria’s crude exports, has frequently faced operational disruptions, affecting the country’s ability to meet production targets.
Nairametrics reported that President Bola Tinubu blamed the explosion on the political crisis in Rivers State. Consequently, the President declared a state of emergency in the state and sacked all elected officials.
Iraq makes second largest cut
Bloomberg reported that Iraq followed with the second-largest reduction after Nigeria, cutting output by 40,000 barrels per day to 4.15 million barrels. Despite this, Iraq maintained above its agreed limit of 4 million barrels per day.
- However, the United Arab Emirates increased production by 30,000 barrels per day, further exceeding its quota.
- Meanwhile, OPEC+—led by Saudi Arabia and Russia has expressed readiness to gradually restore production and increase supplies to stabilize global oil prices.
- The group is expected to add roughly 138,000 barrels per day this month as part of a phased increase running through late 2026.
The decision of the cartel to ease production cuts follows U.S. President Donald Trump’s request to Saudi Arabia to “cut the price of oil” by increasing production. It is uncertain whether this was what informed the decision or not.
Bloomberg’s survey is based on ship-tracking data, information from officials, and estimates from consultants Rapidan Energy Group, FGE, and Rystad Energy.
What you should know
- The cuts highlight OPEC’s ongoing struggle to enforce compliance among its members, with some countries persistently exceeding their quotas despite repeated calls for discipline.
- It is unclear if Nigeria’s reduced output is in compliance with OPEC’s directive of production cuts or a consequence of the perennial challenges impeding improved oil production.
- The administration of President Tinubu set a target of 2.06 million bpd this year, but the country struggles to produce 1.5 million bpd.
