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A senior analysts on international oil politics, Dr. Kinsley Amodu has reacted to the statement credited to the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu in an interview with the Financial Times that the country was still suffering from years of violent disruptions and needed more “recovery time” before joining a supply deal agreed last year between some of the world’s biggest oil producers.
According to the minister, Nigeria will resist any attempts to curb its oil production when it meets with OPEC and Russia later this month.
The cartel cut global supplies to boost crude prices towards $60 a barrel.
Dr. Amodu said “So far you are a member of the Cartel; every decision so made is binding on all member states including Nigeria”.
“Nigeria cannot probate and approbate at OPEC, but can only concur to resolutions so reached at meetings. If it gains from the good ones, it will also be ready to stand the bad ones.
Kachikwu, who represents Nigeria at OPEC meetings, said in an interview that “We have a nine-month exemption period within which to come back to the table”.
However, making reference to the decision to extend the near two million barrel a day supply cut deal from June; he averred that “You need that timeframe to see if any recovery is sustainable.”
His stance may put Nigeria on a potential collision course with other OPEC members.
Nigeria has seen its output jump from a low of 1.4 million b/d a year ago to almost 1.9m b/d in August, according to consultants and analysts OPEC relies on to track members’ oil production. Nigeria’s own output numbers are lower.
Both Nigeria and the conflict-ridden OPEC peer Libya were made exempt from the initial agreement reached late in 2016 as both countries’ oil sectors recovered after years of unrest that crippled the lifeblood of their economies.
A ministerial committee monitoring compliance with the deal, made up of officials from OPEC and those outside the cartel such as Russia, has said Nigeria would cap or curb its output once production stabilised at 1.8m b/d.
Currently, pressure on Nigeria to reduce its crude production is expected to increase when it attends an informal meeting in Vienna later this month with delegations from Saudi Arabia and Russia, which have been leading the cuts effort.
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