Nigeria experienced another drop in its oil production, reaching a daily output of 1.231 million barrels in March, according to the Organisation of Petroleum Exporting Countries (OPEC).
In their latest Monthly Oil Market Report for April 2024, OPEC revealed that direct communication with Nigeria confirmed a decrease in oil production compared to the previous month.
The report indicated that Nigeria produced 1.322 million barrels per day in February but experienced a decline to 1.231 million barrels per day in March, marking a significant decrease of 91,000 barrels per day. This downward trend follows a similar pattern from January to February when production also declined.
Despite the recent decline, OPEC data showed that Nigeria’s average crude oil production for the first quarter of 2024 stood at 1.327 million barrels per day. This figure is higher than the average production of 1.313 million barrels per day recorded in the fourth quarter of 2023. Furthermore, Nigeria’s oil output in the first quarter of 2024 surpassed the average production of 1.201 million barrels per day in the third quarter of the previous year.
The drop in Nigeria’s oil production can be attributed to ongoing challenges such as oil theft and pipeline vandalism. These factors have significantly impacted the country’s output, causing it to fall below the volume approved for Nigeria by OPEC. Just recently, the Nigerian National Petroleum Company Limited reported 155 incidents of oil theft in one week alone. During the same period, illegal pipeline connections and refineries were discovered in the Niger Delta region.
The national oil company also highlighted the seizure of 32 wooden boats transporting stolen crude and illegally refined products in Rivers and Delta states. Additionally, several vehicles loaded with stolen crude were apprehended in Imo, Delta, and Rivers states. The incidence of illegal connections, vandalism, and the discovery of illegal storage sites further illustrate the extent of the problem.
The presence of clusters of illegal refineries in Abia State has caused significant environmental damage. In the past week, 36 clusters of such refineries were uncovered across various locations in Rivers and Abia states. The activities of oil thieves have also led to oil spills and the destruction of aquatic life in Rivers State.
The Nigerian government has been actively addressing the issue of crude oil theft, as it has resulted in substantial financial losses. The theft of over N4.3 trillion worth of crude oil through pipeline vandalism has prompted some international oil companies to shift their operations from onshore to deep offshore oil fields or exit the country altogether.
During the Nigeria International Pipeline Technology and Security Conference in Abuja, the Nigeria Extractive Industries Transparency Initiative presented data indicating that Nigeria recorded 7,143 cases of pipeline breakages and deliberate vandalism between 2017 and 2021. These incidents led to the theft and loss of 208.639 million barrels of crude oil, valued at $12.74 million or N4.325 trillion. To address this issue, Nigeria has invested N471.493 billion in pipeline repairs and maintenance during the same period.
The Nigerian government, along with relevant agencies, continues to prioritize efforts to combat crude oil theft, aiming to eliminate this menace and safeguard the country’s oil industry.