In December 2023, the Organization of Petroleum Exporting Countries (OPEC) upheld a consistent level of crude oil production, averaging 28.05 million barrels per day (bpd), according to a Bloomberg survey. The report highlighted that Nigeria played a pivotal role by contributing an additional 50,000 bpd, augmenting the overall output.
Despite production limitations observed in countries such as the United Arab Emirates and Angola, which curtailed their output, Nigeria’s increased contribution helped OPEC achieve an average production of 28.05 million bpd in December.
The report noted, “Supply declines from these two members were tempered by increases elsewhere. Nigeria bolstered supplies by 50,000 barrels a day to 1.49 million a day in December, in line with a revised quota that it successfully negotiated for this year.”
Contrary to this, the latest data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) suggests the country’s daily oil production stands at 1.25 million barrels, as communicated through its “direct communication” channels.
Looking ahead, OPEC projects Nigeria to produce 1.5 million bpd in 2024, although the federal government asserts the country could potentially reach as high as 2 million bpd this year.
In line with current expectations, Bloomberg forecasts a reduction in output this month as the OPEC+ coalition implements additional cuts of around 900,000 barrels per day. This measure aims to prevent a potential surplus and protect declining crude prices, with Saudi Arabia leading this reduction by maintaining its current cut.
The United Arab Emirates (UAE) has also committed to decreasing its oil production by 163,000 barrels per day, while Iraq plans to cut an additional 220,000 barrels per day for the first three months of the year.
December witnessed Angola’s withdrawal from OPEC, citing its refusal to accept a reduced limit imposed by OPEC’s leaders. However, its output in December, consistent with the rejected level, reflected years of underinvestment.
Looking forward, countries including Saudi Arabia, Russia, the UAE, Iraq, Kuwait, Kazakhstan, and Algeria aim to gradually increase production, contingent on the performance of the oil market.
The overall initiative of OPEC+ to reduce oil production stems from concerns about the decline in prices from almost $98 in late September. There are mounting worries regarding a potential slowdown in the global economy in 2024, leading to an anticipation of surplus oil availability.