Adedapo Adesanya
By Adedapo Adesanya
Nigeria’s headline crude, Bonny Light, saw a $2.43 per barrel increase to trade at an average price of $73.93 per barrel in July 2021.
According to the Organisation of the Petroleum Exporting Countries in its Monthly Oil Market Report, this happened as the OPEC Reference Basket (ORB) gained $1.64 during the month, an increase of 2.3 per cent month-on-month, to settle at $73.53 per barrel, its highest point since October 2018.
Bonny Light is one of the 13 oil components that make up the OPEC Basket and these values rose on higher related crude oil benchmarks and a higher monthly change in their respective official selling price differentials for most components, particularly to the European market.
Compared with the previous year, the year-to-date ORB was up by $25.43, or 63.8 per cent, from $39.85 per barrel in 2020 to an average of $65.27 barrels so far this year.
The Nigerian crude was not the only gainer as 12 other crudes that make up the basket all rose. Other West and North African basket – Djeno (Congo), Es Sider (Libya), Girassol (Angola), Rabi Light (Gabon), Sahara Blend (Algeria), and Zafiro (Equatorial Guinea) – also increased by $2.43 or 3.4 per cent month-on-month on average to $73.93 per barrel.
Multiple region destination grades – Arab Light( Saudi Arabia), Basrah Light (Iraq), Iran Heavy (Iran), and Kuwait Export (Kuwait) – rose by $1.39, or 1.9 per cent month-on-month on average to settle at $73.58 per barrel.
Murban (United Arab Emirates) crude rose by $1.30, or 1.8 per cent, month-on-month on average, to settle at $73.64 per barrel.
The Merey (Venezuela) component also increased by 97 cents equivalent to 1.8 per cent month-on-month on average to settle at $54.49 per barrel.
In the report, the Vienna-based organisation noted that although the global economy will continue to recover, numerous challenges remain that could easily dampen the momentum, particularly, COVID-19.
The report also said that oil demand will rise by 5.95 million barrels per day this year, or 6.6 per cent, unchanged from last month’s forecast, OPEC said in the report.
The report showed OPEC output rose in July by 640,000 barrels per day to 26.66 million barrels per day, as Saudi Arabia unwound the rest of a voluntary supply cut it had made to support the market.
The report forecast a 2.9 million barrels per day rise in supply from OPEC’s rivals in 2022, 840,000 barrels per day more than seen last month, partly because of the decision by OPEC+ to pump an additional 400,000 barrels per day and as higher prices spur investment.
