The attack on oil facilities in Saudi Arabia has left the Organisation of Petroleum Exporting countries (OPEC), with just 940,000 barrels per day of the extra reserve to meet demand, Reuters reports.
The report stated that Nigeria’s capacity to benefit from the shortfall was limited by production instability.
Although it did not give a specific figure on the extent of the output limitations, Reuters said, ‘Nigerian exports have also suffered from disruptions.’ Nigeria’s pipelines are constantly subjected to breaches and ruptures. These disruptions lead to shot-ins on production. The most recent pipeline leak reported in the media was on the Abura oil field in Delta State on August 29.
"Three key crude oil conveyors, the Trans Ramos pipeline, the Nembe Creek Trunkline and the Trans Forcados pipeline, all leaked crude at different times in 2018 and 2019. These pipelines carry about 400,000 barrels of petroleum per day. Besides oil spills, there is also the problem of theft."
Godwin Obaseki, the Edo State governor, had just at the time of the Abura spill, said the country lost 22 million barrels of oil per day in six months.
It was estimated that the attack which the US is accusing already sanctioned Iran of carrying out, took out 5.7m bpd of crude oil.
"According to data from the International Energy Agency, OPEC had a ‘global supply cushion’ of about 3.21m bpd. Saudi Arabia is said to have 2.27m of that petroleum, which has now been taken out by the drone attack claimed by the Houthi rebels but attributed to Iran by the US government.
The attack caused a 15-percent surge in the price of the commodity, which is good news for Nigeria’s oil-dependent economy.
At 3:22 am Monday, Brent crude – the benchmark used to price Nigerian grades, reportedly opened at $66.45 and reached a high of $71.95 per barrel.
The commodity went for around $62 per barrel on Friday.