FG targets 2.5 million barrels per day crude oil production
Brent, the global benchmark for crude oil, has seen a notable price increase over the past three days, reaching over $84 per barrel on Friday. This surge follows weeks of trading at an average of $80 per barrel. The price hike coincides with Nigeria’s announcement of a new crude oil production target of 2.5 million barrels per day, a goal that, if achieved, could significantly boost the country’s foreign exchange reserves.
In January 2024, Nigeria’s oil output rose by 91,476 barrels per day, reaching 1,426,574 barrels daily, compared to 1,335,098 barrels per day in December 2023, according to the latest data from the Nigeria Upstream Petroleum Regulatory Commission (NUPRC). When condensate is included, Nigeria’s oil production increased to 1.64 million barrels per day in January 2024, up from 1.55 million barrels per day in December 2023.
On Friday, global oil price data showed Brent crude trading at $84.14 per barrel at 5:38 pm Nigerian time, marking a $2.23 increase, or a 2.72% rise, from the previous day. Other oil grades, such as WTI crude and Murban crude, also saw price appreciation, trading at $80.74 and $84.07 per barrel, respectively, on Friday evening. WTI crude increased by $2.48, or 3.17%, from the previous day, while Murban crude rose by $1.85, or 2.25%.
The increase in crude oil prices coincides with the Nigerian government’s announcement of a new oil production target of 2.5 million barrels per day. This information was revealed in a document obtained from the NUPRC in Abuja on Friday, where Gbenga Komolafe, the Chief Executive of the commission, emphasized Nigeria’s significant oil and gas reserves in Africa.
Komolafe stated, “The commission has been working diligently to ensure the effective implementation of the Petroleum Industry Act for the growth of oil and gas reserves and to achieve the national average daily production target of 2.5 million barrels of oil and condensate per day in the near term.”
He added, “Although the actual national production currently averages 1.33 million barrels of oil per day and 256,000 barrels of condensate per day, the national technical production potential currently stands at 2.26 million bpd while the current OPEC quota is 1.5 million bpd.”
Komolafe emphasized the investment opportunities that could arise from closing the gap between actual oil production and technical potential, which could help Nigeria unlock additional revenue streams, address the foreign exchange gap, and strengthen economic resilience.
He also highlighted Nigeria’s potential in clean energy technologies, such as green and blue hydrogen, solar, wind, biomass, and critical minerals, as well as its growing young population and large market size.
The Federal Government recently declared to Western nations in Europe and America that Nigeria would not halt the exploration of fossil fuels, despite pressure to discontinue investments in fossils. The Minister of State for Petroleum Resources, Heineken Lokpobiri, stated that the government was working to prevent the complete divestment of International Oil companies from Nigeria and urged stakeholders to support the development of Nigeria’s oil and gas sector for the benefit of its citizens.
