Nigeria: Nigerian oil production eases in August
Latest reading: Brent crude oil prices averaged USD 67.24 per barrel in August, down 3.3% from July. On 29 August, the commodity traded at USD 68.15 per barrel, down 6.1% from 31 July, amid further OPEC+ hikes.
Turning to production, Nigerian oil output ticked down to 1.55 million barrels per day (mbpd) in August, from July’s 1.56 mbpd. Nonetheless, output remained above Nigeria’s OPEC+ quota of 1.50 mbpd for the fifth successive month.
In other news, the country recently signed a production-sharing contract with French energy firm TotalEnergies and local firm South Atlantic Petroleum for two offshore blocks, in a bid to boost exploration and attract investment under Nigeria’s new oil framework.
Outlook: Oil output is forecast to increase in 2025 from 2024, reaching its highest level since 2020, though posting a smaller jump than last year. Rising capacity at the Dangote refinery will underpin crude demand in Nigeria, prompting an increase in production. Nonetheless, the country is still expected to narrowly miss its OPEC+ quota of 1.50 mbpd, hampered by a precarious security situation and an uncertain domestic regulatory environment. Renewed turmoil in the oil-producing Niger Delta poses a key downside risk.