Nigeria’s Oil Production Drops 2% in March 2023

Nigeria’s crude oil production dropped by 2% to 1.517 million barrels per day (bpd) in March 2023, according to a report by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

This is down from 1.547 million bpd recorded in February 2023, the commission said, without providing reasons for the decline. The country had previously seen a rise in oil output of 3.5% in February 2023 to 1.54 million bpd due to an improved battle against oil theft and other factors. However, this latest decline means Nigeria has not met its 1.69 million bpd target for the 2023 budget, which was also benchmarked at $75 per barrel.

Despite the production issues, the country stands to generate more revenue for the budget due to the high global oil prices. The nation’s Bonny Light hit $85.03 per barrel on April 9, compared to $84 per barrel recorded the previous day, indicating $10.03 per barrel in excess of the $75 per barrel budget reference price.

Experts say that the opening of the Chinese economy after the COVID-19 pandemic and the ongoing conflict between Ukraine and Russia are driving the high crude prices. They believe that the prices are sustainable and will remain high in the remaining part of 2023, which will impact positively on the budget.

OPEC and its allies are still monitoring the oil market and targeted making new interventions. Last week, OPEC+ reviewed the crude oil production data for the months of January and February 2023 and noted the overall conformity for participating OPEC and non-OPEC countries of the Declaration of Cooperation, DoC. They urged all participating countries to achieve full conformity and adhere to the compensation mechanism.