Avengers: Chevron suspends operations as oil rises above $50/b

*Chevron Nigeria Office.

*Chevron Nigeria Office.

*Naval deploy troops to region

Kunle Kalejaye

26 May 2016, Sweetcrude, Lagos — Chevron Nigeria Limited has been forced to shut down its operation sequel to Thursday’s attack of its onshore oil facilities in the Niger Delta by suspected militant.

The attack also sequel the increase in the price of crude oil to above $50 a barrel, for the first time in nearly seven months as a global supply glut that plagued the market for nearly two years showed signs of easing.

The disruption in Chevron’s operation was caused by the Niger Delta Avengers, who claimed the bombing of the facility’s mains electricity feed.

Although, the General Manager of Chevron on Policies, Government and Public Affairs, Deji Haastrup in an SMS, states that the company is yet to confirm the attack but Omare, who is the spokesman for the Ijaw Youth Council, IYC, said the attack was real.

Meanwhile, the Nigeria Navy Ship (NNS DELTA), Warri, has deployed more of its men to join their colleagues in the creeks to ascertain the veracity of the claim.

Commander of the base, Commodore Raimi Mohammed, through one of his aides, said that additional troops have been swiftly detailed to locate the blast.

He condemned the attacks saying, if not quickly checked, might further dip the already low oil production due to previous attacks.

The Avengers militants claimed responsibility for the attack Chevron facility stressing that was because the company ignored its warning not to fix a pipeline they had bombed earlier in the month.

Escravos onshore production is said to account for roughly a third of Chevron’s total output, on average 3.8 million barrels per month in 2014.

The company’s projected exports for the first half of 2016 averaged 167,000 barrels per day, b/d, or about five million barrels per month.

Reports claimed that Escravos production was already down by more than 40,000 barrels per day after a May 5 militant attack on a Chevron offshore facility, adding that increased violence over the past few weeks had also made international buyers more reluctant to buy Nigerian crude due to fears of loading delays and cancellations.

As a result of the unrest in the Niger Delta, as well as the crisis in Libya and wildfires in Canada, which had reduced global crude oil out by about four million barrels per day, the price of crude has risen above the $50 mark.

Specifically, benchmark crude oil grade, Brent, was up 36 cents at $50.10 a barrel, the highest in nearly seven months, after a larger-than-expected draw in United States’ crude oil inventories, last week indicated buyers are starting to mop up spare supply.

U.S. crude futures were up 29 cents at $49.85 a barrel, after touching $49.97, the highest since mid-October.

Reports stated that at above $50 a barrel, oil was seen by many market players as breaching a psychological barrier that could lead producers, particularly among U.S. shale companies, to revive operations scrapped in recent years.

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