Brent, the global standard for crude oil, experienced an upswing in price over the last three days, surpassing $84 per barrel on Friday, compared to its average trading value of $80 per barrel in recent weeks.
This surge coincided with the Nigerian government’s announcement of a new target for crude oil production, aiming for 2.5 million barrels per day. Achieving this target could significantly enhance the country’s foreign exchange reserves.
According to the latest data from the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), a federal government agency, Nigeria’s oil output climbed by 91,476 barrels per day, reaching 1,426,574 barrels daily in January 2024, compared to 1,335,098 barrels per day in December 2023.
The NUPRC figures revealed that, including condensate, 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 indicated that Brent was priced at $84.14 per barrel at 5:38 pm Nigerian time. The commodity experienced a $2.23 increase, representing a 2.72 percent rise from the previous day.
Additionally, other oil grades, such as WTI crude and Murban crude, saw price appreciation, trading at $80.74 and $84.07, respectively, on Friday evening. WTI crude rose by $2.48, marking a 3.17 percent increase from the previous day, while Murban crude appreciated by $1.85, representing a 2.25 percent increase compared to Thursday’s cost.
The increase in crude oil prices coincided with the government’s disclosure, through the NUPRC, of the revised oil production target for Nigeria at 2.5 million barrels per day. The information was obtained from a document on Nigeria’s oil sector from the NUPRC in Abuja on Friday, where Gbenga Komolafe, the Chief Executive of the commission, highlighted Nigeria’s substantial oil and gas reserves in Africa.
He said, “The commission has been working assiduously to ensure that the Petroleum Industry Act is effectively implemented for growth in oil and gas reserves as well as achieving the national average daily production target set at 2.5 million barrels of oil and condensate per day in the near term.
“The oil and gas reserves in Nigeria represents 30 per cent and 34 per cent of the African oil and gas reserves respectively. Our vast reserves hold immense potential for sustainable development and prosperity.
“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.”
He noted that closing the gap between the actual oil production and the technical potential presents a window of investment opportunities for investors and a significant opportunity for Nigeria to unlock additional revenue streams, address the current foreign exchange gap and strengthen economic resilience.
Komolafe stated that aside from hydrocarbon resources, Nigeria is blessed with potentials for green and blue hydrogen, solar, wind, biomass and critical minerals for development of clean energy technologies as well as growing population predominated by young people.
“With a coastline along the Gulf of Guinea, market size of more than 200 million people projected to reach between 390 million and 440 million people in 2050, Nigeria represents hope for Africa.
“Interestingly, about 70 per cent of the Nigerian population are under 30, and 42 per cent are under the age of 15, representing a huge economic asset. Indeed, Nigeria’s potentials are derived from its human, natural and material resources which must be mobilised to propel her on a path of economic growth and development and for her sustainable energy future,” the NUPRC’s boss stated.
