Nigerian crude oil is currently trading around $75 per barrel, despite a recent drop in global benchmark crude prices below $70 per barrel. The country’s oil production remains fragile, further straining its economy.
Nigeria’s premium light-sweet crude blends, including Brass River, Bonny Light, and Qua Iboe, continue to be highly sought after due to their low sulphur content and high quality. These blends are trading at over $74.50 per barrel, exceeding the price of the Brent crude contract.
However, the nation’s oil output has been inconsistent. According to OPEC’s September Monthly Oil Market Report, Nigeria’s crude production increased slightly from 1.307 million barrels per day (bpd) in July to 1.352 million bpd in August, a rise of 45,000 bpd. This figure contrasts with claims by the Federal Government (FG), which has suggested that production is nearing 1.6 million bpd.
Earlier in the year, Nigeria’s oil production dropped to 1.25 million bpd in May, even as the Nigerian National Petroleum Company Limited claimed that output was close to 1.7 million bpd. OPEC reported a decline of 30,000 bpd, with production falling from 1.28 million bpd in April to 1.25 million bpd in May.
Global oil prices rebounded by over 1% on Wednesday, recovering some losses from the previous day. Fears that Hurricane Francine might disrupt U.S. oil production outweighed concerns of weakening global demand. As of 0704 GMT, Brent crude futures had increased by 84 cents (1.2%) to $70.03 per barrel, and U.S. crude futures were up by 81 cents (1.2%) to $66.56 per barrel.
On Tuesday, both benchmarks had dropped nearly $3, with Brent hitting its lowest level since December 2021, and West Texas Intermediate (WTI) reaching its lowest point since May 2023. This decline came after OPEC reduced its global oil demand growth forecasts for 2024 and 2025. The organization lowered its 2024 demand growth estimate from 2.11 million bpd to 2.03 million bpd and its 2025 forecast from 1.78 million bpd to 1.74 million bpd.
Meanwhile, China’s crude oil imports reached a record high last month, though they were still 7% lower year-on-year and 3% below the same period last year, according to customs data and Reuters.
