Nigeria's crude oil output rallies slightly in February to 1.4m barrels per day but still lags behind its Opec quota

NIGERIA'S crude oil output rise slightly during February to 1.49m barrels a day according to figures just published by the Organisation of the Petroleum Exporting Countries (Opec) although production still lags behind the historic level of 2.5m barrels.

Traditionally, Nigeria has always had an Opec quota of 2.5m barrels a day, although this rose to a high of 27m barrels during the boom years of the Goodluck administration. Over the last four tears, however, the sector has suffered from a glut, forcing Opec members to reduce their output in a bid to rally global prices.

Like other Opec members, Nigeria was given a reduced quota with her daily output pegged at 1.77m barrels under the terms of the Opec reduction agreement. Since the outbreak of the coronavirus pandemic, Nigerian crude oil output has been on the decline but last month it staged a rally, representing the biggest increase production among the country's Opec peers.

In its March monthly oil market report, Opec said Nigeria's oil production rose by 63,000 barrels to 1.49m barrels per day in February, up from the 1.33m barrels produced in January. Opec's total crude oil production averaged 24.85m barrels a day in February, down by 650,000 barrels on a month-on-month basis.

An Opec spokesman said: “Crude oil output increased mainly in Nigeria, Iraq, Iran, Venezuela and Libya, while production decreased primarily in Saudi Arabia and Angola. Oil demand is forecast to recover in 2021, growing by 5.9m barrels a day but this year’s demand growth will not be able to compensate for the major shortfall from 2020, as mobility is forecast to remain impaired throughout 2021.”

Also, the report noted that as the Covid-19 pandemic had a major impact on the oil market balance, its Declaration of Cooperation action to help stabilise prices has helped. It added that this proactive stance turned out to be a very important element in supporting global economic growth after an estimated drop in oil demand of 9.6m barrels per day in 2020.

According to the group, non-Opec supply is expected to have declined by 2.6m barrels per day in 2020, while a growth of 950,000 barrels is anticipated for 2021. On 10 December 2016, Opec and 11 non-members signed the Declaration of Cooperation committing them to reducing supply in a bid to rally global prices.