Rise in production of Nigerian oil results in increasing OPECĒs production

Rise in production of Nigerian oil results in increasing OPECĒs production
Rise in production of Nigerian oil results in increasing OPECĒs production
Thursday July 7, 2016

The organization of the Petroleum Exporting countries (OPEC) reports an increase in crude production of 240,000 barrels per day (bpd) in June, thanks to gains created by one of its more trouble-ridden members: Nigeria

Data indicates that Nigeria pumped an average of 1.53 million bpd last month, an increase of 90,000 bpd from May, thanks to a reported cease-fore with militants allowing for the reparation of pipelines in the Niger River Delta.

A government’s official a month ago, stated that while recent militant attacks decreased oil production from 2.2 million to 1.3 million bpd, production in late June was between 1.8 million and 1.9 million bpd-and that if repairs to a pipeline are completed, July’s crude production will increase to 2.2 million bpd.

It’s not clear however, if this high goal can be met, as the Niger Delta Avengers militant group over the weekend claimed responsibility for five more attacks on oil installations in the Delta, including Chevron Corporation’s oil wells and three trunk lines of Nigerian Petroleum Development Corporation.

Nigeria’s contribution helped offset reductions posted by other OPEC nations for June, most notable that of Iraq, whose production dropped 70,000 bpd to 4.3 million bpd.

A showing of 3.5 million bpd in June for Iran ended that country’s five-month run of output gains following the lifting of international sanctions. Both Saudi Arabia and Libya reported June output gains, of 70,000 and 40,000 bpd respectively.

Even though an extra 240,000 bpd is nothing to sneeze at, it falls well short of the mark and OPEC must produce over the coming year to accommodate 2017 rates. It has been stated that it will have to pump an extra 650,000 barrels a day over the year, which means finding solutions to the militant attacks, political strife, and economic chaos plaguing its member countries.


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