April 27, (THEWILL) – The World Bank has said Nigeria has the largest shortfall among oil-producing countries during the first quarter of 2022, a development it attributes to sabotage within the oil production system and other factors, such as low investments and the COVID-19 pandemic.
The World Bank which made this revelation in its latest Commodity Markets Outlook report, stated that 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 added that although global oil production rose just under one percent in the first quarter of 2022, based on a quarter-by-quarter analysis, it was around three percent below pre-pandemic levels, an increase it attributed to the decisions of the Organisation 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”, the report stated.
However, despite the modest increase, the bank lamented that the oil-producing countries continued to produce below the official target.
Nigeria’s crude oil production crashed by 744,000 barrels in March 2021, according to OPEC figures.
Earlier in April 2022, it was reported that the OPEC raised Nigeria’s oil production quota from the 1.735 million barrels per day target approved in April 2022, to a new target of 1.753 million barrels per day for May 2022.
About the Author
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
