Nigeria's crude oil production fall below 1m barrels per day for the first time ever in August

NIGERIAN crude oil production dropped dramatically again in August crashing to below 1m barrels per day (bpd) to 972,394 in which statisticians have revealed is the lowest amount recorded since record keeping began.

Historically, the Organisation of Petroleum Exporting Countries (Opec), has given Nigeria a crude oil production quota of 2.5m barrels a day. Over recent years, however, Nigeria has struggled to meet this level of production, as a host of problems like bunkering, oil theft, dilapidated infrastructure, pipeline vandalism, mismanagement and maintenance problems.

In addition, Opec has also been reducing the quota of its members lately in a bid to reduce output in the wake of over-production and subsequent fall in prices. This combination of reduced output and lower Opec quotas has gradually whittled down Nigeria's production to less than 2m barrels a day lately but nothing like this.

These latest figures obtained from the Nigerian Upstream Petroleum Regulatory Commission, indicated that Nigeria's oil production dropped from 1,083,899 bpd in July to 972,394 bpd in August. Nigeria lost about 111,505 barrels of crude oil daily in August, as the Nigerian National Petroleum Company went to court to request a special tribunal for the speedy trial of crude oil thieves and pipeline vandals.

An analysis of the 2020, 2021 and 2022 crude oil and condensate production reports for Nigeria showed that the 972,394 bpd produced in August 2022 was the lowest ever in these years. All the figures for oil production in 2020 and 2021 through January to July 2022 were above 1m barrels per day.

From January, February, March and April 2022, for instance, the country’s crude oil production without condensates were 1.39mbpd, 1.26mbpd, 1.24mbpd and 1.22mbpd respectively. In May, June and July 2022, the figures were 1.02mbpd, 1.16mbpd and 1.08mbpd respectively.

Already, the Petroleum and Natural Gas Senior Staff Association of Nigeria (Pengassan) has threatened to stop producing oil across the country if the federal government failed to nip the menace of oil theft in the bud. It has blamed soldiers and other security agents for conniving with thieves to perpetuate the crime.

Pengassan president, Festus Osifo, said “We’ve had meetings with the security agencies and captains of industry on what could be done to end oil theft but these meetings seem to be yielding no results. We now think that engaging behind the four walls of the office is not enough, because our engagements with those in government have not yielded any meaningful results.”

He observed that with crude oil prices being higher than $100 a barrel, many oil-producing countries were taking advantage of this but the reverse was the case with Nigeria. he added that the federal government borrowed over N6tn to finance the country’s 2022 budget but if the country was able to produce up to 1.9mbpd, there would have been no need for this.