13 July 2017, Sweetcrude, Lagos — Nigeria may have to wait much longer to actualise its dream of a sharp increase in oil price, as U.S. construction and fracking major Halliburton, believes the oil market crash that has lasted three years will cause oil prices to spike by the year 2020.
Quoting World Oil, Halliburton forecasts that an impressive spike in oil price will be noticed around 2020-2021.
Mark Richard Senior Vice President for Global Business Development, added that the oil industry has lost $2 trillion in investments due to chronically low prices.
“Sooner or later, the market is going to catch up,” Richard said. “You’ll see some kind of spike in the price of oil. Maybe somewhere around 2020-2021, but it’s got to catch up sooner or later.”
Production cuts by the Organization of Petroleum Exporting Countries (OPEC) had caused a rise in oil prices back in January, but new production from Nigeria, Libya, and the United States have erased all gains from the market.
Nigeria will not be joining the Organisation for Petroleum Exporting Countries, OPEC’s cap just yet, Sweetcrude Reports has learned.
According to sources close to the situation, the Minister for Petroleum, Ibe Kachukwu, has said that the country is just recovering from months of shut-in oil due to militancy, therefore, asking the country to cap production and export, is too soon.
Sweetcrude Reports also learned that Nigeria’s current production is still below 1.8 million barrels set for the country by OPEC.
“Nigeria’s production is still below OPEC’s 1.8 million barrels per day target for us so, we won’t be capping soon, and nobody can force us to. Whatever glut is in the market should be blamed on the U.S shale and not us. If anybody should be asked to cap, it should be the U.S but unfortunately, the country does not belong to any group,” he said.
“Besides, if there are no more attacks from militants, we should be looking at managing output at about 1.7 million barrels per day for the next four to six months”, he added.
Nigeria currently battles low oil price as the country is in dire need of a high oil price to fund capital projects.
However, just when the country is beginning to recover from spates of attacks on its oil export pipelines, reports surfaced that it would be asked to cap production and export.
But sources close to the situation hinted Sweetcrude Reports that Nigeria will not agree to cap so soon.
Moreover, Kachikwu has said he will not be attending OPEC’s July 24 meeting, fueling speculations that the country may not give in to capping pressure from the Cartel.