By Adedapo Adesanya
Nigeria, Africa’s largest crude oil producer, ended the month of May with the second-highest production drop among countries that make up the Organisation of the Petroleum Exporting Countries (OPEC).
In the month under review, Nigeria lost 45,000 barrels per day, making it the largest laggard among the countries not exempted from the 2020 output deal.
Nigeria’s worsening crude output happens because the country cannot keep up due to a lack of capacity caused by infrastructural deficits and other security issues.
In the month under review, OPEC was not able to lift its production as agreed for the month of May, its production actually decreased, according to OPEC’s latest Monthly Oil Market Report released on Tuesday.
Meanwhile, the group stressed that oil demand could be stymied by Russia’s invasion of Ukraine, which has dictated the market for the last three months.
That point, however, did little to mitigate the market’s fear that OPEC’s spare capacity has been overstated, with Saudi Arabia and the UAE the only members that have any room to increase production.
The extra production from the Kingdom and the Emirates, however, has been offset by an even greater decline in production from Iraq, Libya, and Nigeria.
OPEC produced a total of 28.508 million barrels per day in May—down 176,000 barrels per day from April 2022. The reason for the decline is lower productions in Equatorial Guinea (-2,000 barrels per day), Venezuela (-2,000 barrels per day), Iran (-20,000 barrels per day), Iraq (-21,000 barrels per day), Gabon (-32,000 barrels per day), Nigeria (-45,000 barrels per day), and most notably—Libya (-186,000 barrels per day), according to OPEC’s secondary sources.
Saudi Arabia’s directly reported production was 10.538 million barrels per day.
These losses were partially—but not completely—offset by gains in Saudi Arabia, which increased production by 60,000 barrels per day, reaching an average of 10.424 million barrels per day; the UAE, which saw an increase of 31,000 barrels per day, and Kuwait, which saw a 27,000 barrels per day increase.
For the 10 OPEC members that had assigned quotas for May 2022 totalling 25.589 (which exclude Iran, Venezuela, and Libya), May’s actual OPEC member production was 24.541 barrels per day—a 1.048 million barrels per day shortfall from OPEC’s stated allowances.
