Oil Prices Increase due to Anticipated Supply Constraints by OPEC, the Nigerian Government may find itself Allocating more Funds to Subsidize Premium Motor Spirit (PMS).
Diesel and Aviation Fuel Prices are already Increasing closer to N1,000 per liter, raising concerns for various Sectors, particularly Manufacturing and Aviation.
OPEC’s August Monthly report revealed that Nigeria’s Crude Oil Production has Increased to 1.181 million barrels per day, up by 100,000 compared to July.
Despite the Surge in Oil Prices, which have reached a 10-month high at $92.28 per barrel, Nigeria’s Inability to Refine locally and boost Production has Limited its ability to reap the Benefits.
OPEC predicts Robust Growth in Global Oil demand for 2023 and 2024, driven by the recovery of Major Economies, with an estimated rise of 2.25 million barrels per day in 2024.
Edward Moyai, Senior Market Analyst at Data and Analytics firm OANDA, noted, “Crude prices are rallying after OPEC’s Monthly report showed the Oil Market is going to be a lot tighter than Initially thought.”
While Saudi Arabia has extended its Voluntary Production cut of 1.3 million barrels per day, most OPEC members, including Nigeria, are falling short of meeting their Quotas.
Additionally, disruptions in Oil Production, such as Libya’s terminal closures due to Storms and Kazakhstan’s reduced daily output, are further Complicating the Global Oil Supply.
