OPEC: More Nigeria, Libya oil needed as demand rises, meets today
Bakindo says market re-balancing
The oil market will need more crude from Nigeria and Libya, as it re-balances at a faster rate in the second half after a slow start, Organisation Of Petroleum Exporting Country’s Secretary-General, Mohammad Barkindo has said.
He told told reporters in St. Petersburg, Russia, that, compliance with production cuts by members of the OPEC is “excellent,” adding that, Libya and Nigeria were exempt from the cuts; and have been boosting production, leading to speculation about whether OPEC will seek to cap their output to help reduce a global glut.
“The re-balancing process may be going on at a slower pace than we earlier projected, but it is on course, and it’s bound to accelerate in the second half,” Barkindo said on Sunday.
Demand is expected to grow by 2 million barrels a day in the second half, he said, without specifying if he was comparing that with the same period of 2016 or the first half of this year.
Brent crude prices have declined by fifteen per cent this year on concerns that growing output in Libya and Nigeria, as well as the U.S., is more than making up for production cuts by OPEC members and other oil producers, including Russia.
Saudi Arabia’s Energy Minister Khalid Al-Falih and Russia’s Energy Minister Alexander Novak are scheduled to attend a meeting in St. Petersburg on today, to discuss the progress of their agreement to trim output.
Nigeria, until now, Africa’s crude oil producer and member of the global oil cartel,OPEC, has been given exempt by OPEC because of the security challenges it faced, following, especially, the Boko Haram insurgency in the North East and militancy in the country’s Niger Delta region, which had disrupted production, output, over the last few years, leaving a strain on the economy.
More than 90 per cent of the country’s foreign exchange comes from crude oil export, but due to the ongoing effort by President Muhammadu Buhari’s government, there is a renewed effort at diversifying the economy, with a view to reducing the country’s over dependence on the product.
