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Tag: Organisation of Petroleum Exporting Countries (OPEC)

  • Compliance with quota vital to market stability, says OPEC

    The Organisation of Petroleum Exporting Countries (OPEC) has said the critical value of commitment production quota by members is vital to maintaining market stability in times of uncertainties

    The Joint Ministerial Monitoring Committee (JMMC) of OPEC stated this when it reviewed the August monthly report prepared by its Joint Technical Committee (JTC) and recent developments in the global oil market, as well as near-term prospects in 2019 and 2020.

    The JMMC noted the overall conformity of 159 per cent in July, this year was 22 per cent higher than in June, and the average conformity of 134 per cent since January was the highest to date in the year. This high level of overall conformity has offset uncertainty in the market due to ongoing economic growth worries.

    The JMMC underscored the growing importance of the Declaration of Cooperation in supporting oil market stability, which along with ongoing healthy oil demand so far has arrested global oil inventories growth and should lead to significant draws in the second half of the year.

    The JMMC also noted that, going forward, the forecast for oil market fundamentals by major forecasters remains robust in 2019 and 2020.

    The JMMC urged participating countries in the DoC to continue their strive in achieving full and timely conformity with voluntary production adjustments based on the decisions of the 176th meeting of the OPEC conference, July 1, and the sixth OPEC and non-OPEC Ministerial Meeting, July 2.

  • Oil revenue hits N85tr in five years

    Nigeria earned $236.2 billion (about N85 trillion) from oil between 2014 and 2018, the Organisation of Petroleum Exporting Countries (OPEC) said in its 54th edition of Annual Statistical Bulletin.

    The revenue is 10 times the N8.91 trillion Budget signed last month by President Muhammadu Buhari as Appropriation Act for this fiscal year.

    The figure has placed Nigeria in sixth place and the highest oil revenue earner in Africa among the 14 OPEC member countries surveyed in the report.

    Nigeria currently produces an average of 2.1 million barrel per day (bpd) as against the 2.3 million bpd production peg in the budget. It was 1.6 million bpd in May this year, according to the bulletin. The dip may translate to revenue loss but oil prices surged yesterday, rebounding from their lowest settlement in about five months after attacks on two tankers in the Gulf of Oman.

    Fears of military conflict between Washington and Tehran sent oil price up over 4.5 per cent, with Brent crude hitting $62.64 per barrel and US crude touching $53.45. This is dragging oil away from the five-month lows struck last night.

    West Texas Intermediate crude for July delivery had jumped $1.52 or three per cent, to $52.66 a barrel after tapping an intra-day high of $53.45. Gains were in contrast to a four per cent drop that took the U.S. benchmark down to $51.14 Wednesday, the lowest front-month contract finish since January 14, according to Dow Jones Market Data.

    August Brent crude had also climbed $1.86, or 3.1 per cent, to $61.83, following a session high so far of $62.64 a barrel, reached earlier when reports of the tanker attacks surfaced. The prior session saw Brent tumble 3.7 per cent to $59.97 a barrel, the lowest front-month finish since Jan. 28.

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    The 2019 Appropriation Act has $60 per barrel benchmark.

    According to OPEC, the highest revenue in the review period was $75.2 million (N27.1 billion) recorded in 2014, followed by 2018, when N19.6 billion ($54.5 million) was earned.

    In 2015, 2016 and 2017, the report said ($41.2 million, N9.8 billion ($27.3 million) and $38 million (N13.7 billion) were earned respectively.

    Saudi Arabia topped the earners table with $194.4 billion followed by United Arab Emirates’ (UAE) $74.9 billion, Iraq’s $68.2 billion, Iran’s $60.2 billion and Kuwait’s $58.4 billion.

    On volume of crude oil exported, the report said members of the oil cartel sold an average of 24.67 million barrels per day (b/d) in 2018, a slight increase of about 14,000 b/d, or 0.1 per cent compared to 2017.

    The bulk of sales were made to countries in Asia and the Pacific, followed by Europe and the least exports to North America.

    According to the OPEC bulletin, Nigeria’s daily crude oil production in 2018 was 1.601 million b/d, a 4.3 per cent increase from the 1.535 million b/d recorded in 2017.

    The largest oil producer in Africa had agreed to cap its output at 1.685 million b/d after reaching agreements with OPEC in January to regulate oil supply in order to drive up prices.

    Some other reports have, however, claimed that Nigeria has been producing above the OPEC quota, although the output still falls short of the 2.3 million b/d target the 2019 budget is benchmarked against.

    According to S&P Global Platts survey, Nigeria’s production in May was 1.86 million b/d, a drop from the 1.95 million b/d recorded in April.

  • Oil rises above $71 on tight supply

    Oil prices raced on Wednesday to five-month highs hit the previous day as the Organisation of Petroleum Exporting Countries (OPEC) production cuts and United States (U.S.) sanctions on Iran and Venezuela continued to tighten supply, though economic worries increased.

    Brent crude futures, the international benchmark for oil prices, were up 77 cents, or 1.1 per cent, at $71.38 per barrel U.S. West Texas Intermediate crude oil futures rose 33 cents, or half a per cent, to $64.31 per barrel.

    Oil markets have tightened this year because of U.S. sanctions on oil exporters Iran and Venezuela, as well as supply cuts by OPEC and some non-affiliated producers including Russia, a group known as OPEC.

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    Supplies from OPEC dropped by half a million barrels a day in March to a four-year low as Saudi Arabia continued to curb production. The monthly output cut totals about half a per cent of global crude demand.

    Brent and WTI crude oil futures have risen by more than 30 per cent and 40 per cent respectively since the start of the year.

    “The global oil market is clearly moving back towards balance thanks to OPEC+ production cuts,” ING bank said.

    The Dutch bank said the reduction was not only down to voluntary supply cuts, which the group started this year to prop up prices, but also involuntary curbs from Venezuela and Iran – which are exempt from the OPEC cut pact – due to U.S. sanctions.

  • Trump tweets complicating oil volatility, says OPEC scribe

    The  Secretary-General, Organisation of Petroleum Exporting Countries (OPEC)  Mohammed Barkindo, yesterday said President Donald Trump’s tweets, highly critical when crude oil prices rise, have complicated oil markets.

    Trump has occasionally blasted OPEC when members discuss curbing production to prop up crude oil prices. But he has also praised de facto OPEC leader Saudi Arabia for taking steps to ease crude oil prices.

    The social media comments are among the various factors OPEC has been trying to juggle as it looks to stabilise markets in the face of the U.S. shale boom.

    “The tweets are one of the new additions to these uncertainties. The president doesn’t give notice before he tweets. (This) Makes our job more difficult in focusing on the fundamentals,”” Barkindo said at a news conference yesterday at CERAWeek by IHS Markit.

    Still, even though Trump’s tweets can make crude oil prices wobble, he added that he welcomes the president’s engagement.

    “It’s understandable that any president in the U.S. would take more than a passing interest in what happens to the energy and oil markets. Since we are in a digital age of course tweets have become one medium of communication. We welcome this rising interest in Washington on what’s happening. We welcome a president during this dialogue,” Barkindo said.

    OPEC will meet in April to decide if it should extend or scale back its deal with top nonproducers to curb production by 1.2 billion barrels per day to prop up crude oil prices.

    West Texas Intermediate, the U.S. benchmark for crude oil prices, was up 0.2 per cent at $56.93 a barrel. Brent crude oil prices rose 0.2 per cent to $66.73.

    Shares of oil giants Exxon Mobil (XOM) and Chevron (CVX) were up 0.4 per cent and 0.5 per cent, respectively, on the stock market today.

     

    But Trump’s tweeting isn’t alone in causing instability in crude oil prices.

    Barkindo said the Trump administration’s waivers to U.S. sanctions on Iranian oil have added to uncertainty.

    China and India, the top two importers of Iranian oil, are among eight countries that received temporary waivers on Iran sanctions. The waivers will expire in May and it’s unclear which, if any country, will get an extension.

    Meanwhile, pending legislation in the U.S. Congress is another X factor. The House Judiciary Committee passed the No Oil Producing and Exporting Cartels (NOPEC) Act last month, paving the way for a vote in the full House.

    The NOPEC bill would change U.S. antitrust regulations to allow the U.S. attorney general to sue OPEC members for collusion.

    But Barkindo warned that the NOPEC legislation as it stands “would not serve the interest of the United States.”

    “It would also usurp the interests of the oil and gas industry that has seen such a remarkable rebound,” he said.

  • Oil rises on U.S, China trade deal, OPEC cuts

    Oil prices rose yesterday, buoyed by output cuts by the Organisation of Petroleum Exporting Countries (OPEC) and reports that the United States and China are close to a deal to end a year-long tariff row.

    International Brent futures were at $65.25 a barrel, up 18 cents, or 0.3 per cent, from their last close.

    U.S. West Texas Intermediate (WTI) crude futures were at $55.94 per barrel, up 14 cents or 0.3 per cent.

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    The U.S. and China appeared close to a deal that would roll back U.S. tariffs on at least $200 billion worth of Chinese goods.

    Beijing has also pledged structural economic changes and elimination of retaliatory tariffs on U.S. goods, a source briefed on negotiations said on Sunday in Washington.

  • Kachikwu: ‘Nigeria’s compliance with OPEC’s deal stabilised prices’

    Nigeria’s compliance with the Organisation of Petroleum Exporting Countries’ (OPEC+) production cut deal in February helped to stabilise global oil prices.

    Minister of State for Petroleum Emmanuel Ibe Kachikwu, who stated this in an interview, said:  “We’re basically complying, effective February with the country’s pledged 53,000 barrel-a-day reduction.

    “The price fluctuations mean OPEC needs to be a bit more together, a bit more determined to try to defend the market,” he said.

    Nigeria actually boosted crude production by 52,000 barrels a day to 1.792 million in January, according to third-party estimates compiled by OPEC’s secretariat.

    However in February, the country was compliant with its agreed 1.685 million barrel-a-day limit, Kachikwu said, adding that the producers’ group will meet again in April to discuss whether to continue the supply reductions in the second half.

    Nigeria would have a hard time making deeper cuts, the minister said. “If more cuts need to come, there would be major challenges because between December and now we’ve had the Egina field come online,” Kachikwu said. The offshore field, operated by French energy giant Total SA, hasn’t yet reached its maximum production level of about 200,000 barrels a day, but may do so in March, he said. Some of that output is a light oil called condensate, which isn’t counted in the OPEC+ deal, and some is crude, he said.

    OPEC and allies agreed to reduce output by 1.2 million barrels a day in the first half of this year in order to prevent a supply glut.

    While the deal has contributed to a jump in crude prices of more than 20 per cent so far this year, implementation has been uneven, with Saudi Arabia cutting deeper and faster than promised and other nations including Russia going slow.

     

  • OPEC to discuss Nigeria, others output

    Organisation of Petroleum Exporting Countries (OPEC) may not slash crude production of Nigeria and other 13 members of the cartel, if the pleas by the United States President, Donald Trump, that OPEC should keep to the current production cost to avoid further price slump, is anything to go by.

    OPEC, last year, exempted Nigeria and Libya from  production cut and further extended deadline for Nigeria till the end of 2018.

    Currently, Nigeria produces between 1.75 million to 1.8 million barrels per day, and may maintain its daily crude production, in the event that the cartel agrees with Trunp’s advice on the issue.

    This is coming as OPEC is meeting members today and tomorrow (Friday)   in Austria, Vienna, to discuss with them on how to lower their output and other issues that are germane to the development of the market.

    “Hopefully Opec will be keeping oil flows as is, not restricted. The World does not want to see, or need, higher oil prices!” Trump said on Twitter.

    Hopefully OPEC will be keeping oil flows as is, not restricted. The World does not want to see, or need, higher oil prices!

  • Oil gains as producers say market is rebalancing

    Oil gains as producers say market is rebalancing

    Oil prices kept most of their gains from the previous session as major producers meeting in Vienna said the market was well on its way towards rebalancing.

    The WTI crude front month discount to the same month of Brent futures hit 6.28 dollars, the widest since August 2015, as U.S.crude was pressured by hurricane damage to U.S. refineries.

    Brent therefore rises to 63.19 dollars as report media hide price with ambiguous  coverage.Add 56.91 plus 91 dollars.

    Brent crude futures was up 0.05 per cent at 56.88 dollars a barrel, not far from a 6-1/2-month high of 56.91dollars set on Friday.

    The Organisation of Petroleum Exporting Countries ( OPEC ), Russia and several other producers have cut production by about 1.8 million barrels per day (bpd) since the start of 2017, helping lift oil prices by high numbers n the past three months.

    Kuwaiti Oil Minister Essam al- Marzouq, who chaired Friday’s meeting of the Joint Ministerial Monitoring Committee, said output curbs were helping cut global crude inventories to their five-year average, OPEC’s stated target.

    The dollar index was up 0.2 per cent against a basket of currencies.

    The euro slipped after Germany’s election showed surging support for a far-right party that left Chancellor Angela Merkel scrambling to form a governing coalition.

    Russia’s energy minister said no decision on extending output curbs beyond the end of March was expected before January, although other ministers suggested such a decision could be taken before the end of this year.

    Iran expects to maintain overall  crude and condensate exports at around 2.6 million bpd for the rest of 2017, a senior official in the nation’s state oil company said.

    Meanwhile, the UAE’s energy minister said its compliance to supply cuts was 100 per cent.

    Nigeria is pumping below its agreed output cap, its oil minister said.

    “Oil is relatively underpriced compared with other markets, but any steep rise would be offset by rising shale oil production,” said Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo.

    Markets were also eyeing developments in North Korea. U.S. Treasury Secretary Steve Mnuchin on Sunday said President Donald Trump wants to avoid nuclear war with North Korea and “will do everything we can” to avoid conflict.

  • OPEC appoints Nigerian board Chairman

    OPEC appoints Nigerian board Chairman

    The Organisation of Petroleum Exporting Countries (OPEC) Friday announced the appointment of Mr. Olusegun Adekunle as the Alternate Chairman of the Economic Commission Board.

    Mr Idang Alibi, Director Press Ministry of Petroleum Resources who broke the news in Abuja said: “In a welcome development, OPEC announced the appointment of Nigeria’s Mr Olusegun Adekunle as the Alternate Chairman of the 127th OPEC Economic Commission Board.

    “Dr Ibe Kachikwu expressed delight at the development while congratulating Adekunle and urging him to continue to work hard to justify the appointment and make Nigeria proud.’’

    Adekunle was before this appointment Nigeria’s representative to the organisation.

    The Commission is saddled with the responsibility of writing reports and making recommendations to the Conference of OPEC Oil Ministers on oil prices and other economic issues.

    It also assists OPEC in promoting stability in international oil prices at equitable levels.

  • OPEC develops framework to stabilise global oil market

    OPEC develops framework to stabilise global oil market

    Following its meeting in September in Algiers, Algeria, the Organisation of Petroleum Exporting Countries (OPEC) has begun to develop a framework to stabilise the global oil market.

    The Algerian meeting was where OPEC members agreed to cut output on 28th September to halt continued crude oil supply glut and shore up price. As a result of the landmark agreement, the meeting was tagged Algiers Accord.

    The first meeting of the high-level committee of the Algiers Accord was held Friday in Vienna, Austria where the OPEC Secretary General, Mohammad Sanusi Barkindo called for cooperation among members of the Organisation to help achieve sustainable oil market stability.

    He also mandated that the Committee develop a framework of high-level consultations between OPEC and non-OPEC producing countries.

    Barkindo said: “Since the Algiers Accord, a ‘road map for implementation’ has already begun to take shape. This has emerged in the process of carrying out extensive consultations with other stakeholders on how best to honour and implement the Conference’s decision – in the interest of all producers and consumers.

    “Thus, OPEC has sought to use every occasion in recent weeks to advance the Accord. It has used additional platforms to confer with other producers. Similarly, OPEC has used other fora – like the G-24 Ministerial and the IMF/World Bank meetings in Washington, as well as the World Energy Congress in Istanbul – for extensive exchanges of perspectives on the current challenges facing not only the oil and gas industry but the global economy in general.

    “The market has been out of balance for too long, due primarily to supply driven forces. These have led to a severe correction in prices, impacting required and timely investments, which is now threatening future supply. OPEC and non-OPEC must now come together and take coordinated and timely action for the common good of all.

    “While we have seen the rebalancing process already underway, the physical market remains in surplus. A large stock overhang continues to persist. And today’s excess stocks of around 300 million barrels calls for our collective and urgent action.

    “The recent high-level OPEC-Russia Dialogue meeting was a good reflection of the broader consultations with other producers that we continue to undertake in response. Personally, I also just visited Baghdad, Iraq – the birthplace of our Organization and a key founder member – in order to solidify the consensus of the Algiers Accord.”