Nigeria’s estimated crude production fell by 185,000 barrels per day to 1.59 million in May following the country’s pledge to cut production in line with a pact by members of the Organisation of the Petroleum Exporting Countries and its allies, OPEC+.
The country’s crude oil production was published in the latest data obtained from OPEC.
OPEC and partners agreed in April to cut output in response to low demand and crashing prices caused by the coronavirus crisis. They all initially agreed to do this by 9.7 million barrels in May and June but met two weeks ago to extend the deal to July.
However, Nigeria failed to keep its side of the agreement since the new cut which prompted the country, through its Minister of State for Petroleum Resources, Mr Timipre Sylva, to promise a compensation cut.
Recall that there were reports Nigeria would be producing 1.412 million barrels per day in May and June, in addition to condensate production of between 360,000 and 460,000 barrels per day, which are exempted from OPEC cuts.
But OPEC said the country’s production level, based on secondary sources, was 180,000 barrels per day or about 13 percent higher than the quota given to it.
The group uses secondary sources to monitor its oil output, but also publishes a table of figures submitted by its member countries. Nigeria, however, did not provide its production figure for May, the report showed.
The number of active oil rigs in the country fell by 50 percent in May amid the coronavirus-induced collapse in prices and drop in demand for crude.
Data obtained from Baker Hughes Incorporated and OPEC also showed that Nigeria’s rig count fell to eight in May from 16 in April and 21 in March.
Crude oil sales remain the country’s main source of foreign earnings. Revenue generated from the commodity is used to fund critical projects in Nigeria and the crash of prices of oil earlier this year, especially before the output deal was reached, affected the nation, force the review of its 2020 budget twice in two months.
