Oil production falls by 0.41mbpd in June, threatens 2018 budget

Oil production falls by 0.41mbpd in June, threatens 2018 budget

Nigeria’s crude oil and condensate production has dropped to 1.89 million barrels per day (mbpd), indicating over 0.41 mbpd shortfall projected in the 2018 budget, data released by the Ministry of Petroleum has shown.

The ministry in its latest Periscope Newsletter made available to newsmen on Monday indicated that the crude oil production, which includes condensate, fell to 1.82 mbpd in May and 1.89 mbpd in June 2018.

In May, a data released by the National Bureau of Statistics showed that the country recorded an average daily crude oil production of 2.0 mbpd in the first three months of 2018, a volume higher than the average production recorded in the last quarter of 2017 by 0.05 mbpd.

This implies, the current crude oil production is still a far cry from the 2.3 mbpd production benchmark set in the 2018 budget.

Read also: Confidence in Nigerian economy rises in June, to rise further in July

According to the release, the nation’s average oil production between January and April 2018 stood at 2.0 mbpd except February which recorded 2.1 mbpd.

On June 20, President Muhammadu Buhari signed the nation’s 2018 budget worth N9.12 trillion based on the following assumptions: Oil price benchmark was put at $51 per barrel; oil production was projected at 2.3 mbpd; exchange rate was pegged at N305/USD.

Although, crude oil prices have been rising at the international market, selling above $75 per barrel, owing to the agreed production cut deal of 1.8 mbpd in December 2016 by Organization of Petroleum Exporting Countries (OPEC) and unexpected supply disruptions in Venezuela, Libya and Angola.

However, the nation’s crude oil production and exports have been depleted, implying that 41.7 percent of the N7.17 trillion funding expected from oil revenues for the 2018 budget might likely not be achieved.

By Oluwasegun Olakoyenikan…


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