A Review of the Nigerian Energy Industry

Nigeria’s oil production to rise by less than 0.1MBPD in 2015

09 April 2015, Lagos –  OPEC’s non-crude liquids production, which averaged 6.4 million bpd in 2014, is expected to increase by less than 0.1 million bpd in both 2015 and 2016, led by increases in Qatar and Kuwait.

OPEC headquarters
OPEC headquarters

In February 2015, unplanned crude oil supply disruptions among OPEC producers averaged 2.7 million bpd, an increase of 0.1 million bpd compared with the previous month.

According to U.S Energy Information Administration (EIA), this increase was mainly attributable to rising outages in Iraq, Nigeria, and Libya.

It noted that unplanned OPEC crude supply disruptions averaged 2.4 million bpd in 2014, 0.5 million bpd higher than in the previous year.

The high level of OPEC disruptions contributed to higher crude oil prices during the first half of 2014.

It stated that unplanned supply disruptions could still affect crude oil prices, but the threshold that the market can bear has risen in light of robust global production and increases in inventory levels.

EIA expects OPEC surplus crude oil production capacity, which is concentrated in Saudi Arabia, to increase to an annual average of 2.1 million bpd in 2015 and 2.6 million bpd in 2016, after averaging about 2.0 million bpd in 2014. Surplus capacity is typically an indication of market conditions, and surplus capacity below 2.5 million bpd is an indicator of a relatively tight market.

Consumption outside of the Organization for Economic Cooperation and Development (OECD), which grew by 1.2 million bpd in 2014, is projected to grow by 0.8 million bpd in 2015 and by 1.1 million bpd in 2016. The reduction in forecast non-OECD consumption growth in 2015 is mostly attributable to a 0.2 million bpd decline in Russia’s consumption as a result of its economic downturn.

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