Anxiety returns as crude price sheds 2.5% in int’l market

There is fresh anxiety among government officials as the news of a sharp drop in the prices of crude oil hit the airwaves.

Observers at the international oil market said the gains of January and early February 2017 were eroded by a drop of 2.5 per cent in price of Brent crude, on Thursday through Friday.

Last week, a barrel of the brand was about $56.32, but it came down to about $55.32 on Monday and maintained the downward trend on Tuesday, thereby causing uneasy calm among officials, who have been making projections of early exit from recession facing Nigeria based on this.

The OPEC team absolved member-countries from any complicity, but blamed the development on excess volume of crude oil, released by the United States oil interests.

The oil cartel said it would not yet react officially on the development, pending further action by marketers.

Read also: CRUDE OIL: Libya increases supply dropping price of Nigeria’s Brent

“The agreement on how to check excess crude output is still working and efforts are on to involve more non-member countries to buy in to the deal,” the Kuwait’s Oil Minister, Essam al-Marzouq, was quoted by a foreign news agency as having said.

Compliance within OPEC members to cut production saw a remarkable improvement in the new year, showing Brent crude futures being up by more than 50 cents in the first week of January, selling at $54.25 a barrel, while West Texas Intermediate crude went up by 41 cents at $53.45 a barrel.

Further rise in price in February 2017 was received by producing countries with cautious optimism, but Nigeria went with a prediction that its two-year old recession would ease off in 2017, on the price increase.

But analysts still believe that a steady rise in price of the commodity would lead to an early exit from the country’s economic downturn.

 

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