Nigeria’s crude oil revenue has continued to slump as the Organization of the Petroleum Exporting Countries’ newly released Monthly Oil Market Report for September revealed that the country’s crude oil output fell to 900, 000 barrels per day (b/d) in August.
According to the OPEC report, Nigeria’s crude oil production (according to data reported by direct sources) dropped from 1 million b/d recorded in July, to 900, 000b/d last month.
This is as the price of the country’s crude grade, Bonny Light, also dropped by 10 per cent within the space of one month (July-August).
Bonny Light, which was sold for $117/b in July, dropped to $106/b in August, Punch is reporting.
The country’s revenue from crude oil rose significantly year-on-year, as Bonny Light price rose by 64 per cent between 2021 and August 2022 but this was a result of an increase in the price of crude oil in the period under review.
According to the report, the price of Bonny Light as of 2021 was $67 per barrel. However, this increased to $110 per barrel in August 2022.
Bonny Light is a light-sweet crude oil grade produced in Nigeria. It is an important benchmark crude for all West African crude production, and usually $1+ higher than international crude grade, Brent.
Nigeria’s crude oil production has been witnessing significant drops for some years now, as the country last recorded a 1.4mb/d in 2020.
Production gradually crashed further to 1.3mb/d at the beginning of 2021,and further to 1.2mb/d in the first quarter of this year.
As at the second quarter of this year, output dropped to 1.1mb/d, to 1mb/d in July, and 900, 000b/d last month.
Despite the continuous rise in demand for OPEC crude, Nigeria’s low output puts its earnings at risk, as the country has been unable to benefit fully from the rise in demand.
