By Emmanuel Obisue
World Bank has noted that Nigeria’s largest shortfall among oil-producing countries is due to sabotage within the oil production system and other factors, such as low investments, as well as the Covid-19 pandemic.
Nigeria has a shortfall of 500,000 barrels per day, while Angola and Russia both have a shortfall of 300,000 barrels per day, the bank said in its latest Commodity Markets Outlook report.
According to the World Bank, while global oil production rose just under one per cent in the first quarter of 2022 based on a quarter-by-quarter analysis, it was around three per cent below pre-pandemic levels.
The US-based bank further attributed this increase to the Organization of the Petroleum Exporting Countries, OPEC Plus.
“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.
“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,” part of the report read.