Oil price hits $50, Nigeria’s exports to rise

Minister of State for Petroleum Resources, Ibe Kachikwu

’Femi Asu

Global oil benchmark, Brent crude, extended its rally on Sunday to hit the $50 per barrel mark, the third time this year.

This comes as the expected return of the Forcados export terminal has helped to boost Nigeria’s planned crude oil exports this month to about 1.98 million barrels per day, the most since January.

Forcados, whose export has been suspended since February after militant attack on the export line, is one of Nigeria’s largest crude grades with an average output of about 200,000 bpd last year.

No tankers have loaded from the terminal so far, according to Bloomberg ship-tracking data. Eight cargoes are scheduled to load this month with another six planned for November.

The recent upsurge in militant attacks in the Niger Delta pushed oil shipments, the nation’s biggest export, to as low as 1.38 million bpd in August from a high of 2.1 million bpd in January.

The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, last week, noted that the country had lost an average of 500,000 to 700,000 bpd over the last six to eight months.

Commenting on the militancy in an interview with Bloomberg, the minister said the government was doing all it could to address the problem, adding that oil production had risen to 1.7 million bpd, up from a low of 1.2 million bpd about two months ago.

Kachikwu said, “We think that if we can finalise the dialogues in the month of October, which is my anticipation, we should be able to get ourselves to end the year at about an average of two million barrels.”

Oil prices have been on an uptrend since the Organisation of Petroleum Exporting Countries decided to cut output for the first time in eight years.

Brent, against which half of the world’s oil is priced, had risen to around $48 per barrel last Wednesday after OPEC agreed to reduce production, compared to $45 earlier in the day.

It stood at $50.19 per barrel as of 4.53pm Nigerian time on Sunday, up from around $49.66 per barrel on Thursday.

OPEC agreed to cut production to a range of 32.5 million barrels per day to 33 million bpd from around 33.5 million bpd.