The latest monthly oil market report released by OPEC on
Thursday shows that Nigeria’s oil output dipped by 270,000 barrels per day
(bpd) to 999,000 bpd in April from 1.26 million bpd in March, based on direct
communication. The last time Angola overtook Nigeria was in May 2022, when oil
theft was rampant.
Angola’s oil production rose by 91,000 bpd to 1.06 million
bpd in May, up from 978,000 bpd in March, based on direct communication.
Nigeria suffered the biggest decline in production, the
least in seven months according to government data, among its OPEC peers,
followed by Iran, which lost 262, 000 bpd in April, based on direct
communication.
OPEC’s oil production declined by 310,000 bpd to an average
of 28.8 million bpd, the lowest level in almost a year due to a fall in Iraq’s
exports and pipeline suspension while a labour strike cut shipments from
Nigeria.
Oil and gas analysts have pinned the recent decline on the
shutdown of activities at the Forcados oil terminal, one of Nigeria’s major
export terminals. According to experts, the oil terminal has been shut down for
two weeks. Also, strike action at the Nigerian unit of ExxonMobil has cut off
production.
“The dip in oil production in April is due to the current
sectional replacement on the Forcados line,” Stanley Akhile, operations team
Lead at Midwestern Oil and Gas Company Limited, told our correspondents through
a phone call.
“Because of the sectional replacement at the oil terminal,
virtually all the injectors in the Forcados line are down. That is why they
have been a drop in production. Injectors are not pumping into the Forcados
line. Some have shut down their flow station because their tanks are filed up
because of the sectional replacement on the Forcados line.”
Sectional replacements at oil terminals refer to replacing a
pipeline or storage tank section that has become damaged or worn out. It
involves cutting out the damaged section of the pipeline or tank and installing
a new section in its place.
“The Forcados line has not been replaced since it was
commissioned. It has punctures due to vandals. Some sections of the Forcados
line are already worn-out. Irrespective of the maintenance carried out on the
terminal, it will not sustain. They will be leakages on those points,” Akhile
said.
The 13-member oil cartel revealed in the report that crude
oil production increased mainly in Saudi Arabia, Angola and IR Iran, while
production in Iraq and Nigeria declined.
OPEC uses secondary sources to monitor its oil output but
also publishes a table of figures submitted by its member countries.
According to secondary sources, total OPEC-13 crude oil
production averaged 28.60 million bpd in April 2023, lower by 191,000 bpd
month-on-month.
Data from the Nigerian Upstream Petroleum Regulatory
Commission (NUPRC) revealed that Nigeria’s oil production fell to 998,602 bpd
in April, the lowest in seven months.
Data from the upstream regulatory body shows that the
country’s oil production decreased by 23 percent from 1.3 million bpd in
February this year. On a year-on-year basis, it dipped by 18 percent from 1.21
million bpd.
Preliminary data indicates that global liquids production in
April decreased by 0.5 million bpd to an average of 101.3 million bpd compared
with the previous month.
“Non-OPEC liquids production (including OPEC NGLs) is
estimated to have decreased m-o-m in April 2023 by 0.3 million bpd to average
72.7 million bpd,” the 13-member oil cartel said.
“The share of OPEC crude oil in total global production
remains unchanged to stand at 28.2 percent in April, compared with the previous
month.”
According to OPEC, estimates are based on preliminary data
for non-OPEC supply, OPEC NGLs and non-conventional oil, while assessments for
OPEC crude production are based on secondary sources.
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