A journalist from Ripples Nigeria stated that the country might earn N66 billion per day from oil if it can solve its production problems, which would be the most in the last seven years.
On the 4th February 2022, the chance of making more money from crude oil sales grew when Brent jumped $2.16 (2.37 percent) to $93.27 per barrel. This occurred amid the Russia-Ukraine crisis and a severe cold in Texas, which caused some US oil production to be halted. On Friday, the closing price of Brent crude, the energy benchmark for Nigerian oil, reached its highest level since 2014. If Nigeria meets its OPEC quota of 1,718,000 barrels per day (bpd), the current oil price will earn Nigeria $159.7 million (N65.8 billion at current exchange rate) every day.
Nigeria has the biggest quota among Africa’s oil-producing countries, with a production quota of 1,435,000 barrels per day (bpd). Saudi Arabia and Russia, with a combined quota of 10.331 million bpd, are at the top of the global list. At the most recent OPEC+ meeting, it was agreed that ten OPEC members would supply 25.06 million bpd, while non-OPEC countries would produce 16.233 million bpd. According to a statement dated February 2, 2022, the production quota will take effect in March 2022.
It should be noted that this is a good development for the FG in terms of revenue, as it will boost the government’s external generated revenue and assist with capital expenditures. It’s also pertinent to mention that with the FG backing off from subsidy removal, these new development means that the country would therefore be paying more for subsidy. However this new development implications as regards to the price of Petroleum Products (AGO MGO PMS)is that while the FG insists on continue paying subsidy for now, the increase of such payment has led major marketers to hold on to their products, leading to the current scarcity of product as a slight hike in price.
Source: Ripples Nigeria, Vanguard, The Cable.
