FG could Pocket over N8bn daily as OPEC agrees Nigeria Pump More Oil 'If Possible' as Oil Price Nears $120pb

FG could Pocket over N8bn daily as OPEC agrees Nigeria Pump More Oil 'If Possible' as Oil Price Nears $120pb

  • The ongoing conflicts between, Russia and its neighbouring country Ukraine continues to affect oil prices
  • Reports have shown that the price of crude oil which is nearing $120 per barrel and this could an all-time high in the last 10 years
  • Opec has agreed to allow member countries to produce more and this could mean more money for the Nigerian government

Nigeria's crude oil production quota for April 2022 received a boost following an agreement by the Organization of the Petroleum Exporting Countries (OPEC) and its allies to increase their combined output by 400,000 barrels per day (bpd) as the conflict between Russia and Ukraine continues, CNBC reports.

Under the new agreement, Nigeria is expected to produce 1.735 million bpd, higher than the 1.72 million for March bpd and 1.70 million bpd for February.

This good news is coming as oil prices raced to as high as $117 per barrel on the early hours of Thursday, 3rd March 2022.

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Nigeria to pocket more money as OPEC agrees Nigeria's produce more oil 'if it can' as oil nears $120pb
Lagos Offshore oil rig at night Credit: Karo Kes
Source: Getty Images

Should Nigeria in any way meet its production quota for April and sell it could be earning a whopping $200.6 million(N86.6 billion) every day should oil hit $120 per barrel.

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Although, in the budget, 2022 Nigerian government proposed a total oil production level of 1.88 million bpd very much unlikely for Nigeria to meet its production quota for April as it continues to hover around 1.2 million, 1.3 million barrels per day production

Petrol subsidy

Another layer on the rising crude oil price could also mean Nigeria is set to pay more for subsidy in the coming months should supply disruption in Russia continues.

Figures from the Nigerian National Petroleum Corporation shows that Nigeria paid over .1.4 trillion as subsidy in 2021, should oil remains above $100, this could mean to keep petrol price at N165 Nigeria will spend most of its expected income on subsidy payment.

Read also

Breaking: Oil price rises to $112 a barrel, petrol subsidy under threat

Nigeria has only $60 million left in its excess crude account

Meanwhile, It is almost game over for Nigeria and one big withdrawal from the excess crude account could see it drop to an unredeemable state.

According to reports, Nigeria's excess crude account has dropped significantly to just over $72 million.

Even with oil trading above the expected price, Nigeria cannot save its oil revenue for which the ECA is created.

Source: Legit.ng

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