Nigeria cuts crude oil production, other OPEC members join in

Nigeria cuts crude oil production, other OPEC members join in

- Nigeria has cut its crude oil production by around 400,000 barrels per day until April 2022

- The ministry of petroleum announced the drastic measure in a statement it released on Friday, April 10

- Nigeria and other OPEC members signed a historic agreement to cut global oil production by 10million barrels

In the face of the crash in the price of crude oil on the global market, the Nigerian government has cut down drastically on its daily production of the commodity.

The ministry of petroleum resources revealed this in a statement seen by Legit.ng on Friday, April 10.

According to the ministry, Nigeria joined other OPEC members to "cut supply by up to Ten (10) Million Barrels per day between May and June 2020, Eight (8) Million Barrels per day between July and December 2020 and Six (6) Million barrels per day from January 2021 to April 2022, respectively."

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In this regard, Nigeria, which produced as per October 2018 figures, 1.829 Million Barrels per day of dry crude oil, will now produce 1.412 Million Barrels per day, 1.495 Million Barrels per day and 1.579 Million Barrels per day respectively for the corresponding periods in the agreement.

The petroleum ministry says OPEC members hope that the agreement would boost oil prices by at least $15 per barrel in the short term.

This way, there is hope that the rebound would meet the needs in Nigeria’s adjusted budget estimate that is currently rebased at $30 per barrel and crude oil production of 1.7 Million Barrels per day.

The ministry says, with the expected price rebound, Nigeria may make additional revenue of not less than $2.8bn.

Legit.ng reported that the federal government of Nigeria was forced to slash the 2020 budget by N312 billion following the crash of crude oil prices in the global market due to coronavirus.

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The 2020 budget has now been cut from the initial N10, 594, 362,364,80 to N10,276, 887,197,728.

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However, this decision by the executive arm of the federal government is subject to the approval of the legislature.

Mele Kyari, Nigeria National Petroleum Corporation's general managing director, had warned against tough times amid fear of global recession following the fall in the price of petroleum.

Kyari gave the warning on Tuesday, March 10, during the ongoing consultative roundtable themed ‘Going for Growth’ organised by the Central Bank of Nigeria (CBN) in Abuja.

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Source: Legit.ng

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