Economy
OPEC+ Quota Increase Keeps Oil Market in Deficit—Analysts
By Adedapo Adesanya
The move by the Organisation of the Petroleum Exporting Countries and allies (OPEC+) to raise production limits by 400,000 barrels per day monthly from this month will leave the oil market in deficit at the end of 2021, research analysts at Merrill Lynch have said.
The analysts, Karen Kostanian and Ekaterina Smyk, noted that the move by the 23-member alliance was positive for oil in both the short and medium-term as a change in baseline production levels does not mean an immediate 1.6 million barrels per day hike from April 2022 and will mostly redistribute quotas within OPEC+.
“Production quotas may be adjusted on the way, while baseline production changes signal a general commitment from the key member.
“Production quotas may be adjusted on the way, while baseline production changes signal a general commitment from the key members,” they said.
Business Post had reported that last month, after a brief stalemate between Saudi Arabia and the United Arab Emirates (UAE), the members agreed to raise the output limit imposed on five countries, by phasing out 5.8 million barrels per day of oil production cuts by September 2022.
The analysts allayed concerns that oil prices would run into some turbulence post the latest OPEC+ agreement as the market feared upcoming supply hikes and importantly the select members potentially flooding the market in 2022 with cumulative 1.6 million barrels per day additions to baseline production levels.
Last week, oil settled lower with the Brent crude recording more than 7 per cent drop and the United States West Texas Intermediate (WTI) falling more than 5 per cent amid fears that the faster-spreading Delta variant would slow fuel demand in China and the rest of Asia.
Most oil market experts also believe that the OPEC deal last month, marking the end of a gridlock, will help cool prices which have climbed to 2-1/2year highs as the global economy recovers from the coronavirus pandemic.
As part of the latest agreement, Russia should be able to add 100,000 barrels per day each month starting from August (its 25 per cent share of OPEC+ quota) and its baseline production level will be increased from April 2022 by 500,000 barrels per day to 11.5 million barrels per day for crude only.
“First, the reversal of 500,000 barrels per day by the end of 2021 means oil production (crude + condensate) could reach almost 11 million barrels per day, just 3.0 per cent below pre-Covid levels.
“Should OPEC+ continue to add 400,000 barrels per day per month in Q1, Russia essentially would be allowed to fully restore production by the end of Q1 2022.
“Second, the baseline crude production of 11.5 million per day practically means that Russia would have to produce roughly 1 million barrels per day above its historical maximum,” Merrill Lynch analysts said.
“We hence believe that Russia is highly unlikely to reach its baseline levels on a 1 – 2 year horizon considering flat CAPEX levels over the past couple of years. The next big growth project is not expected to come online before the mid-2020s,” they said.
Bloomberg survey for OPEC production shows that the group increased crude production by 400,000 barrels per day month on month in July as part of the OPEC agreement to reverse 1.15 million barrels per day of the cuts through May-July.
Saudi Arabia led an increase adding close to 500 barrels per day which were offset by small declines in production across other producers while Iranian production was almost flat in July as it added 30,000 barrels per day.
By Aduragbemi Omiyale
The acquisition of the Bullet brand portfolio from Sun Mark has been completed by Champion Breweries Plc, a statement from the company confirms.
This marks a transformative milestone in the organisation’s strategic expansion into a diversified, pan-African beverage platform.
With this development, Champion Breweries now owns the Bullet brand assets, trademarks, formulations, and commercial rights globally through an asset carve-out structure.
The assets are held in a newly incorporated entity in the Netherlands, in which Champion Breweries holds a majority interest, while Vinar N.V., the majority shareholder of Sun Mark, retains a minority stake.
Bullet products are currently distributed in 14 African markets, positioning Champion Breweries to scale beyond Nigeria in the high-growth ready-to-drink (RTD) alcoholic and energy drink segments.
This expansion significantly broadens the brewer’s addressable market and strengthens its revenue base with an established, profitable portfolio that already enjoys strong brand recognition and consumer loyalty across multiple markets.
“The successful completion of our public equity raises, together with the formal close of the Bullet acquisition, marks a defining moment for Champion Breweries.
“The support we received from both existing shareholders and new investors reflects strong confidence in our long-term strategy to build a diversified, high-growth beverage platform with pan-African scale.
“Our focus now is on disciplined execution, integration, and delivering sustained value across markets,” the chairman of Champion Breweries, Mr Imo-Abasi Jacob, stated.
Through this transaction, Champion Breweries is expected to achieve enhanced foreign exchange earnings, expanded distribution leverage across African markets, integrated supply chain efficiencies, portfolio diversification into high‑growth consumer beverage categories, and strengthened presence in the RTD and energy drink segments.
The acquisition accelerates Champion Breweries’ transition from a regional brewing business to a multi-category consumer platform with continental reach.
Bullet Black is Nigeria’s leading ready-to-drink alcoholic beverage, while Bullet Blue has built a strong presence in the energy drink category across several African markets.
By Adedapo Adesanya
Emerging market fintech firm, M-KOPA, has announced plans to deepen its reach in Nigeria to the South South and South East regions, starting with Edo this year, after providing N231 billion in credit to over 1 million customers in the country.
The firm released its first Nigeria-focused Impact Report, which showed that Nigeria is M-KOPA’s fastest-growing market and fastest to reach the milestone.
Since its foray into the Nigerian market in 2019, M-KOPA has been working to dismantle barriers to financial inclusion by providing flexible smartphone financing and digital financial tools that align with how people in the informal economy earn and manage their money.
It operates in six states in the country, including Lagos, Ogun, and Oyo, among others.
The report highlights the company’s contribution to income generation, digital inclusion and economic opportunity for Every Day Earners across the country.
The report showed that M-KOPA has enabled 290,000 first-time smartphone users, while 56 per cent of agents accessed their first income opportunity through the platform.
It showed high income and livelihood gains among its users, with about 77 per cent of customers leveraging smartphones or digital loans obtained through the platform to generate income, indicating that access to financed devices is directly supporting micro-entrepreneurial activity and informal sector productivity.
Furthermore, 75 per cent of users report higher earnings since gaining access to M-KOPA’s services, suggesting measurable improvements in personal revenue streams. On the distribution side, 99 per cent of agents disclose increased earnings, reflecting positive spillover effects across the company’s value chain.
In addition, 81 per cent of long-term customers state that their household expenses have improved, pointing to enhanced financial stability and better consumption smoothing over time.
Speaking on the report, Mr Babajide Duroshola, General Manager, M-KOPA Nigeria, said, “Nigeria represents extraordinary potential, and we’re proud that it has become M-KOPA’s fastest-growing market. Our Impact Report shows that when Every Day Earners gain access to the right digital and financial tools, they use them to create stability and long-term progress for their families. This is about access that unlocks opportunity and sustained prosperity.”
On its expansion plans Nigeria-wide, the M-KOPA helmsman said, “Many of the states we are considering are already similar to the ones we are currently in proximity… So, there is proximity and similarity between these states, and that’s what we are going to do, starting with Edo.”
He noted that as M-KOPA Nigeria continues to expand, the focus remains on ensuring more everyday earners gain access to the digital and financial tools they need to build resilient, prosperous futures in Nigeria’s rapidly digitising economy.
By Aduragbemi Omiyale
The ban on the export of raw shea nuts from Nigeria has been extended by one year by President Bola Tinubu.
A statement from the Special Adviser to the President on Information and Strategy, Mr Bayo Onanuga, on Wednesday disclosed that the ban is now till February 25, 2027.
It was emphasised that this decision underscores the administration’s commitment to advancing industrial development, strengthening domestic value addition, and supporting the objectives of the Renewed Hope Agenda.
The ban aims to deepen processing capacity within Nigeria, enhance livelihoods in shea-producing communities, and promote the growth of Nigerian exports anchored on value-added products, the statement noted.
To further these objectives, President Tinubu has authorised the two Ministers of the Federal Ministry of Industry, Trade and Investment, and the Presidential Food Security Coordination Unit (PFSCU), to coordinate the implementation of a unified, evidence-based national framework that aligns industrialisation, trade, and investment priorities across the shea nut value chain.
He also approved the adoption of an export framework established by the Nigerian Commodity Exchange (NCX) and the withdrawal of all waivers allowing the direct export of raw shea nuts.
The President directed that any excess supply of raw shea nuts should be exported exclusively through the NCX framework, in accordance with the approved guidelines.
Additionally, he directed the Federal Ministry of Finance to provide access to a dedicated NESS Support Window to enable the Federal Ministry of Industry, Trade and Investment to pilot a Livelihood Finance Mechanism to strengthen production and processing capacity.
Shea nuts, the oil-rich fruits from the shea tree common in the Savanna belt of Nigeria, are the raw material for shea butter, renowned for its moisturising, anti-inflammatory, and antioxidant properties. The extracted butter is a principal ingredient in cosmetics for skin and hair, as well as in edible cooking oil. The Federal Government encourages processing shea nuts into butter locally, as butter fetches between 10 and 20 times the price of the raw nuts.
The federal government said it remains committed to policies that promote inclusive growth, local manufacturing and position Nigeria as a competitive participant in global agricultural value chains.
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