The Organization of the Petroleum Exporting Countries and its allies (OPEC+) has agreed to a modest oil production increase of 137,000 barrels per day for November, following a consensus between Saudi Arabia and Russia, two of the group’s most influential members.
The decision, confirmed in a statement on OPEC’s website, reflects a cautious approach to balancing market share ambitions with price stability.
Russia, traditionally in favor of supply restraint to support prices, backed a limited adjustment, while Saudi Arabia pushed for a larger increase to defend its market share.
The compromise comes amid growing signs of a global oil surplus and softening prices, with Brent crude and Nigeria’s Bonny Light trading near four-month lows. Bonny Light hovered around $69 per barrel just days before the announcement.
Implications for Nigeria’s Oil Economy
The production increase presents both opportunities and challenges. While higher output from OPEC+ could signal confidence in market resilience, it also risks further pressure on prices, potentially impacting government revenues and foreign exchange inflows.
The Nigerian National Petroleum Company (NNPC) recently secured a two-year extension agreement to ensure the steady supply of crude to the 650,000-barrel-per-day Dangote Refinery located in Lekki, Lagos. The move is aimed at reducing Nigeria’s dependence on imported fuel and stabilizing domestic supply.
However, the broader market dynamics remain uncertain as unsold cargoes from the Middle East are beginning to accumulate, and futures curves are showing signs of weakness. The International Energy Agency (IEA) projects that global inventories will rise sharply this quarter, with a record surplus expected by 2026 due to cooling demand and increased supply from the Americas.
Despite these concerns, OPEC+ delegates did not discuss surplus risks during Sunday’s brief nine-minute meeting, continuing the group’s tradition of offering a more optimistic outlook than the IEA. The next formal gathering is scheduled for November 2.
Strategic Shifts and Global Pressure
Saudi Arabia, which had absorbed the largest share of earlier production cuts, is now leading the push to unwind curtailments and reclaim market share. The timing of the decision is notable, coming ahead of Crown Prince Mohammed bin Salman’s visit to Washington next month for talks with President Donald Trump, who has repeatedly called for lower oil prices.
The series of production hikes also highlights the limitations of spare capacity within the OPEC+ alliance. Of the eight key members, only about 60% of the 2.2 million barrels per day scheduled for restoration between May and September has been achieved.
This shortfall is partly due to overproduction penalties and signals that some countries may already be operating near their maximum output levels.
For Nigeria, the evolving OPEC+ strategy underscores the importance of domestic reforms, infrastructure investment, and diversification to buffer against external shocks in the global oil market.
What You Should Know
According to the Nigerian Upstream Petroleum Regulatory Commission, Nigeria’s oil output recorded significant growth in July 2025, averaging 1.71 million barrels of oil per day (bopd). The figure comprises 1.507 million bopd of crude oil and 204,864 bopd of condensates.
- This reflects a 9.9% year-on-year surge from the 1.56 million bopd produced in July 2024, which included 1.33 million bopd of crude oil and 226,866 bopd of condensates.
- On a month-on-month basis, output rose by 0.89% compared to the 1.69 million bopd recorded in June 2025, which comprised 1.505 million bopd of crude oil and 191,572 bopd of condensates.
On the monthly performance of Nigeria’s crude oil terminals, Forcados recorded the highest output in July 2025 with 9.04 million barrels, representing a 2.1 per cent increase from 8.85 million barrels in June.
At the Bonny terminal, production rose to 8.07 million barrels in July, an 12.7% increase compared to 7.16 million barrels recorded in the previous month.
