Economy
Nigeria Adds 77,000bpd Crude Oil in October, Remains Below OPEC Target
By Adedapo Adesanya
Nigeria continued to lag in its crude oil production despite increasing its output by 77,000 barrels per day in October, but it wasn’t enough to return the country to the top of the table as Africa’s largest producer.
The country is now in the fourth position behind the trio of Angola, Algeria, and Libya due to its continued inability to meet the Organisation of Petroleum Exporting Countries (OPEC) oil quota.
In the month under review, Algeria drilled 1.060 million barrels per day, Angola produced 1.051 million barrels per day, Libya’s output was 1.163 million barrels per day, while Nigeria’s oil production stood at 1.024 million barrels per day.
Even though Algeria gained a paltry 2,000 barrels per day, it lost 40,000 barrels per day, with Libya gaining 6,000 barrels per day, according to OPEC’s secondary source in its Monthly Oil Market Report (MOMR) published on Monday.
Giving its review of Nigeria’s economic environment, OPEC noted, “Nigeria’s economic outlook has been impacted by the devastating rains and floods that affected 31 of Nigeria’s 36 states and has resulted in a significant loss of land, lives and livelihoods. The latest data suggested that record-high inflation continues to persist.”
“Upward price pressures were mainly caused by supply disruptions amid the widespread flooding and higher import costs. However, considering the broad money-supply growth of 21% y-o-y in August, there is a significant monetary component behind the inflationary spiral,” it added.
The cartel warned, “the inflationary pressures are suppressing consumption spending, which might weigh on the growth of household volume consumption.”
OPEC’s crude oil production dropped by 210,000 barrels per day in the month under review compared to the previous month after the cartel, and the wider OPEC+ group reversed the small output increase in September.
The crude oil production of all 13 OPEC members, including those exempt from the OPEC+ pact – Venezuela, Iran, and Libya – averaged 29.49 million barrels per day in October.
Saudi Arabia, the de facto leader of OPEC and its top producer, saw its production decline by 149,000 barrels per day to an average of 10.838 million barrels per day last month, as OPEC+ decided in early September to reverse a 100,000 barrels per day increase in target oil production, which was only intended for September.
Saudi Arabia’s production dropped the most among OPEC members and was below the targeted production level of 11.004 million barrels per day per the schedule the OPEC+ meeting had adopted. The Kingdom self-reported higher production for October than secondary sources’ estimates, at 10.957 million barrels per day, down by 84,000 barrels per day compared to September.
Production in Angola saw the second-steepest drop in OPEC producers in October, but it wasn’t the result of a conscious reduction since the top African producer has been lagging behind its quota for many months. Angola’s crude oil production fell by 78,000 barrels per day to 1.067 million barrels per day in October, according to OPEC’s secondary sources.
Over the coming months, OPEC’s production is set to decline further after the OPEC+ alliance decided to reduce its collective target by 2 million barrels per day for November.
Although the actual cut is expected to be around half that number, at 1.1 million barrels per day, it still is the biggest cut since the record production reduction announced in April 2020 when oil demand plunged at the start of the COVID-19 pandemic.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited depreciated further by 0.44 per cent on Wednesday as selling pressure continued as investors monitor happenings in Rivers State, where pipeline explosion and political crisis triggered a state of emergency by President Bola Tinubu.
Investor sentiment was weak at midweek as Customs Street ended with 37 price losers and 13 price gainers, representing a negative market breadth index.
Livestock Feeds lost 10.00 per cent to trade at N8.46, eTranzact declined by 9.40 per cent to N5.30, Coronation Insurance slumped by 9.27 per cent to N2.35, MRS Oil shed 8.99 per cent to settle at N162.00, and May and Baker crashed by 8.05 per cent to N8.00.
On the flip side, Julius Berger appreciated by 8.47 per cent to N137.00, Omatek gained 6.15 per cent to close at 69 Kobo, UPDC rose by 2.69 per cent to N3.05, Wema Bank expanded by 2.43 per cent to N10.55, and Unilever Nigeria improved by 2.12 per cent to N38.50.
Business Post reports that all the key sectors witnessed profit-taking except the industrial goods space, which closed flat.
The insurance counter went down by 1.62 per cent, the banking index lost 1.37 per cent, the energy space shed 1.32 per cent, the commodity sector tumbled by 0.45 per cent, and the consumer goods industry shrank by 0.09 per cent.
Consequently, the All-Share Index (ASI) contracted by 460.56 points to 104,915.13 points from 105,375.69 points and the market capitalisation dropped N288 billion to finish at N65.790 trillion compared with Tuesday’s value of N66.078 trillion.
The market recorded a turnover of 1.4 billion stocks worth N12.4 billion in 12,012 deals versus the 350.0 million stocks valued at N8.2 billion traded in 11,230 deals in the preceding session, indicating a surge in the trading volume, value and number of deals by 290.46 per cent, 51.22 per cent, and 6.96 per cent, respectively.
The busiest equity yesterday was Sovereign Trust Insurance with the sale of 1.0 billion units for N989.0 million, Fidelity Bank transacted 42.8 million units worth N723.2 million, Access Holdings exchanged 30.6 million units valued at N698.0 million, Jaiz Bank sold 24.0 million units worth N85.0 million, and Zenith Bank traded 21.6 million units valued at N1.0 billion.
By Dipo Olowookere
The president of Dangote Industries Limited, Mr Aliko Dangote, has disclosed that Nigeria was now self-sufficient in cement and fertilizer, with the surplus being exported to earn foreign exchange (FX), which the country desperately needs to boost the Naira and the economy.
He said the target of his company is to make the nation self-sufficient in whatever it consumes, noting that his Lagos-based refinery is currently meeting domestic demand for Premium Motor Spirit (PMS), otherwise known as petrol.
After a meeting with the governor of Ogun State, Mr Dapo Abiodun, the industrialist, said he would continue to invest in the country.
Mr Dangote was in Ogun State to finalise plans to build a multi-billion-dollar seaport and two new lines of cement plant with a capacity of 6.0 million metric tons per annum, (Mta) at Itori.
The richest man in Africa said he was attracted to Ogun State because of the investor-friendly climate in the state and the policies of Mr Abiodun.
He recounted how his predecessor, Mr Ibikunle Amosun, frustrated his efforts to invest in Ogun State, saying, “We had earlier abandoned our vision of investing in the Olokola Free Trade Zone (OKFTZ), but because of your policies and investor-friendly environment, I want to say we are back and will work with the state government to return to Olokola, and plans are underway to construct the largest port in the country.”
“Our factory at Itori was pulled down twice. When we started the second time, they not only demolished the factory but also the fence, so we left. But right now, because of His Excellency, our governor, Prince Dapo Abiodun, we are back. When you visit the factory, you will be surprised at what we have done,” he stated.
In his remarks, Mr Abiodun described the day the Dangote Refinery groundbreaking was performed in Lagos as “the day of heartbreak for the sons and daughters of Ogun State as they watched helplessly on television.”
But he thanked Mr Dangote for “coming back to Ogun State” to invest after his earlier bad experience, saying, “We welcome your return to the state” to complete the cement factor at Itori.
The Governor emphasized that with the establishment of the Itori cement plant, proposed to produce six million metric tons of cement per annum, and the existing Ibeshe plant, producing 12 million metric tons, cement production in the state would total 18 million metric tons per annum, making it the largest cement producer in Nigeria and sub-Saharan Africa.
He lauded the company for not shirking its Corporate Social Responsibilities (CSRs) to the host communities, just as it is currently constructing the Inter-change-Papalato-Ilaro road, assuring that his administration is ready to work with the conglomerate for the good of the state and the nation as a whole.
By Aduragbemi Omiyale
The $20 billion Dangote Petroleum Refinery in Lagos has announced the suspension of the sales of petroleum products in Naira.
This action came after the Nigerian National Petroleum Company (NNPC) Limited halted its Naira-for-crude oil agreement with the company and other local refiners.
Last month, the state-owned oil agency said it would stop selling crude oil to Dangote Refinery in Naira from the end of this month, claiming its deals was for six months, from October 2024 to March 2025.
This came after the private refinery triggered a price war with the NNPC, crashing the price of premium motor spirit (PMS) to N825 per litre from its depots.
The NNPC operates in the downstream sector of the petroleum industry but the Dangote Refinery only has partners like MRS Oil, Ardova Plc, and Heyden, which sell its products to customers at retail prices.
In a statement signed by its management of Wednesday, Dangote Refinery it temporarily halted the sale of petroleum products in Naira “to avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in U.S. dollars.”
“To date, our sales of petroleum products in Naira have exceeded the value of Naira-denominated crude we have received.
“As a result, we must temporarily adjust our sales currency to align with our crude procurement currency,” it stated.
“We remain committed to serving the Nigerian market efficiently and sustainably. As soon as we receive an allocation of Naira-denominated crude cargoes from NNPC, we will promptly resume petroleum product sales in Naira,” the statement emphasised.
The company also debunked reports that it stopped loading from its facility “due to an incident of ticketing fraud.”
Dangote Refinery described these reports as “malicious falsehood,” noting that its systems “are robust and we have had no fraud issues.”
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