Nigeria May Lose Highest Oil-Producing Status in Africa as Production Slumps Again
- The Organisation of Petroleum Exporting Countries (OPEC) said Nigeria’s crude oil production experienced a decline in May
- The global oil watchdog said Nigeria produced about 1.25 million barrels daily in the month under review
- OPEC cited two sources in its monthly crude oil production report released on Tuesday, June 11, 2024
Data from the Organisation of Petroleum Exporting Countries (OPEC) shows Nigeria’s crude oil production declined to 1.25 million barrels daily in May 2024.
The information is contained in OPEC’s monthly oil market report released on Tuesday, June 11, 2024, and is based on direct communication with Nigerian authorities.
Source: Getty Images
Nigeria is still Africa’s largest oil producer
OPEC’s data comes from communication with member countries and secondary sources such as energy intelligence platforms.
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The 1.25 million barrels in May represents a 2.34% drop from the 1.28 million barrels recorded in April this year.
According to reports, despite the dip in oil production, Nigeria remains Africa’s largest oil producer for the month under review, with Libya coming second with 901,000 barrels and Algeria third with 264,000 barrels of crude.
Secondary sources reported a different figure, showing that Nigeria’s crude oil production rose by five percent to 1.41 million barrels daily, up from the 1.35 million barrels per day produced in April.
Top oil-producing countries in Africa
The two figures, however, fall short of OPEC’s 2024 oil production quota for Nigeria, which is about 1.5 million barrels daily.
The global oil cartel said crude oil production from Gabon and Equatorial Guinea increased, with Saudi Arabia, Kuwait, Libya, and Congo experiencing a decline in production.
OPEC reported that crude oil production averaged 26.63 million barrels per day in May 2024, an increase of 29,000 barrels per day.
Nigeria experiences massive crude oil theft
Reports say the total non-OPEC DoC crude oil production averaged 14.29 million barrels daily in May 2024, a monthly decline of 152,000.
Mexico saw increased crude output, while Russia and Kazakhstan saw a drop in oil production.
In April, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Mele Kyari, said that Nigeria could produce two million barrels daily, noting that it cannot be achieved due to oil theft and pipeline vandalism in the Niger Delta region.
Experts predict a drop in FX reserves due to low output
Nigeria experienced the worst crude oil theft in history in 2022, with reports saying that over 70% of crude oil produced was lost to organised criminal gangs controlled by the country’s elite.
In March of this year, Nigeria briefly lost its status as Africa’s largest oil-producing country to Angola and Libya.
According to analysts, Nigeria’s oil production dropped to 1.24 million barrels, which impacted the country’s external reserves.
Energy experts believe Nigeria’s oil output is not correctly reported as authorities constantly clash with OPEC on crude oil figures.
Energy policy analyst Adeola Yusuf disclosed that inadequate crude production affects the naira’s performance.
“Crude oil export accounts for 98% of Nigeria’s forex earnings and is unsuitable for the economy and the currency.
“The call for diversification should be clearer and Nigeria needs to invest in other sectors to earn forex from and strengthen the economy and the local currency,” he said.
Dangote refinery set to buy another crude oil from US
Legit.ng earlier reported that Dangote Petroleum Refinery, established by Africa's richest man, Aliko Dangote, was preparing to import crude oil from the United States in the coming months.
Bloomberg reports that the Dangote refinery plans to purchase at least 24 million barrels of US crude oil over the next year.
Proofread by Kola Muhammed, journalist and copyeditor at Legit.ng
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Source: Legit.ng
