Nigeria’s earning from Oil is set to receive boost as Brent crude on Wednesday rose above $57 a barrel for the first time in almost a year.
The rise in the value of oil is a result of Saudi Arabia’s decision to cut an additional one million bpd in production in February and March as the collective non-member countries of the Organisation of Petroleum Exporting Countries’ (OPEC+) effort to control prices appeared to not be effective enough for the Kingdom.
Nigeria, Africa’s major oil producer, depends on earnings from oil to finance its N13.588 trillion budget for this year. The budget has a benchmark oil price of $40 per barrel; daily oil production estimate of 1.86 million barrels (inclusive of Condensates of 300,000 to 400,000 barrels per day); exchange rate of N379 per US Dollar; GDP growth projected at three per cent; and inflation closing at 11.95 per cent.
In the same vein, the Nigerian National Petroleum Corporation (NNPC) stated its commitment to abide by the output cut agreement of the OPEC and its allies called OPEC+, to stabilise the global oil market.
Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari, who gave the assurance at the ongoing virtual Gulf Intelligence UAE Global Energy Forum 2021, said despite the negative effects of the production cuts on government revenue, it was the best step towards redeeming the value of oil on the global market, in the interest of all.
