Sabotage, COVID-19 pandemic and low investments have been identified as the factors responsible for making Nigeria the largest shortfall among oil-producing countries.
The World Bank in its latest report, which puts Nigeria’s oil shortfall of 500,000 barrels per day, added that Angola and Russia both have a shortfall of 300,000 barrels per day.
According to the bank, despite global oil production rise just under one per cent in the first quarter of 2022 based on a quarter-by-quarter analysis, it was discovered that it was just three per cent below pre-pandemic levels.
It said the Organization of the Petroleum Exporting Countries Plus was responsible for the increase.
The report read, “The increase was entirely accounted for by OPEC+, where production rose by about 1 mb/d as the group continued to unwind its earlier cuts. Output among non-OPEC+ countries fell slightly by 0.2 mb/d in the first quarter, with a decline of 0.3 mb/d in the United States partially offset by a modest rise in Brazil.”
The World Bank said even with rise in production, oil-producing countries are still producing below the official target.
“Although OPEC+ production increased modestly, the group continues to produce well below its official target. In March 2022, 12 of the 19 countries subject to production cuts were below their quotas. Since the start of 2022, the shortfall has averaged more than 1 mb/d, and in March the gap had widened to 1.4 mb/d as Russia’s production declined.
“At present, the largest shortfalls are in Nigeria (0.5 mb/d) and Angola and Russia (each 0.3 mb/d). Production has been affected by a variety of temporary factors including maintenance (Kazakhstan and Libya), protests (Kazakhstan), sabotage (Nigeria), and bad weather (Iraq, Libya).
“In addition to these factors, low investment in recent years, compounded by COVID-19, may have reduced productive capacity. The group is expected to fully unwind its agreed production cuts by September 2022, in line with previous announcements,” the Bank said in its report.
OPEC had in early April 2022, increased Nigeria’s quota from the 1.735 million barrels per day target approved in April 2022 to 1.753 million barrels per day for May 2022 after the Federal Government called for an inclusive energy transition that would be beneficial to not just Nigeria but to other countries in Africa.
