The Pacesetter Frontier Magazine

Tag: Crude oil

  • NLC Demands Wage Awards, Crude Allocation to Local Refiners as Petrol Price Rises

    NLC Demands Wage Awards, Crude Allocation to Local Refiners as Petrol Price Rises

    Precious Nwonu, Enugu

    The Nigeria Labour Congress has called on the Federal Government to introduce emergency measures to cushion workers and households from the impact of rising petrol prices.

    The NLC also urged the government to sell crude oil to local refineries in naira and expand the country’s petroleum storage capacity to strengthen energy security.

    The call was contained in a statement titled, “Save the Situation Now,” signed by the NLC President, Joe Ajaero, on Wednesday.

    The labour union said the latest increase in petrol prices would further worsen the economic difficulties facing Nigerians, noting that the product now sells for about N1,430 per litre in major cities, with prices reportedly higher in less accessible areas.

    Ajaero warned that the increase would have wider economic consequences because higher transportation costs typically lead to increases in the prices of food, rent, school fees and other essential goods and services.

    The NLC questioned why the government would allow Nigerians to bear the full impact of rising fuel prices under the deregulation policy, particularly with the next general elections approaching.

    It argued that government intervention to cushion the effect of the increase should not be regarded as inappropriate, particularly during an emergency.

    According to the union, the latest surge in petrol prices came at a time when government efforts to persuade oil marketers to reduce pump prices in line with lower international crude prices were beginning to yield results.

    The NLC attributed the latest pressure on fuel prices to the resurgence of conflict in the Gulf but said Nigeria’s status as an oil-producing country and its local refining capacity should provide some protection against external shocks.

    Ajaero said the government should immediately introduce measures to shield workers, households and businesses from the impact of the higher fuel prices.

    He specifically called for the payment of reasonable wage awards to workers nationwide, the allocation of sufficient crude oil to local refineries in naira and the expansion of national petroleum storage capacity.

    The labour leader said the measures would not only cushion Nigerians from the immediate impact of higher fuel prices but could also create jobs, generate economic value and strengthen the country’s response to security challenges.

    The NLC maintained that government intervention through palliatives was justified in emergency situations, arguing that oil-producing countries had adopted various measures to protect their citizens from the effects of global energy shocks.

    Ajaero further said the government’s additional earnings from the international oil market provided room for intervention.

    He claimed that the government was currently earning between $35 and $40 more per barrel than the figure used in the budget, describing the difference as a windfall that should be used to support Nigerians during the current period of economic pressure.

  • Crude Oil price falls below $90 per barrel; signals danger for nation’s economy

    Crude Oil price falls below $90 per barrel; signals danger for nation’s economy

    Nigeria’s oil revenue recorded further shock with Brent Crude, the international benchmark, falling below $90 per barrel for the first in seven months, yesterday.

    Minister of Finance, Budget and Planning, Zainab Ahmed, said the government was projecting a total revenue of N8.46 trillion in 2023 out of which N1.9 trillion is expected from oil-related sources while the balance would come from non-oil sources.

    Ahmed had explained that crude oil price is pegged at $70 per barrel at the exchange rate of N435.57 per dollar, oil production is put at 1.69 million barrel per day

    As at 17.50 WAT yesterday, Brent traded at $82.55 per barrel, a development that may not augur well for Nigeria in the face of dwindling oil revenue.

    Nigeria in the past months has consistently failed to meet its Organisation of Petroleum Exporting Countries (OPEC) 1.83 million barrels per day quota due to massive oil theft, among other constraints.

    The country lost 90,000 barrels per day in August, or roughly 2.8 million barrels in the month, making last month’s production of 1.43 million bpd one of the lowest in five years.

    Minister of Finance, Budget and Planning, Zainab Ahmed stated that the government is projecting a total revenue of N8.46 trillion in 2023 out of which N1.9 trillion is expected to come from oil-related sources while the remaining balance is to come from non-oil sources.

    Ahmed explained that crude oil price is pegged at $70 per barrel at the exchange rate of N435.57 per dollar, oil production is put at 1.69 million barrel per day

    Oil demand concern and weaker than expected economic news from China have reversed the gains oil prices booked on Monday after OPEC+’s meeting, with both Brent crude and WTI opening trade on Wednesday with losses.

    Brent slipped from $92.83 per barrel at the end of Tuesday to $91.72 per barrel at the time of writing, down by more than a percentage point.

    West Texas Intermediate was down from $86.88 per barrel at close on Tuesday to $85.62 per barrel in early trade on Wednesday.

    “The OPEC+ news is now in the market and the focus has temporarily shifted to economic and inflationary concerns amongst which the two relevant factors are the extended COVID lockdowns in China and Thursday’s ECB rate decision,” PVM oil analyst Tamas Varga told Reuters.

    “Fundamentally we’re probably moving in the right direction in terms of calming the oil market, but all of that friction out there related to Russia seems like it’s only going in one direction,” FGE president Jeff Brown told Bloomberg following the OPEC+ meeting.

    “OPEC is essentially signaling that we don’t like US$90 a barrel. They’re pretty much at production limits, so let’s defend a high price,” he also said.

    (Sun)

  • Nigeria’s oil production dips to 1.24m bpd, lowest this year

    All is not well in Nigeria’s oil industry as the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) stated that oil output dropped to an average of 1.24 million barrels per day (bpd) from 1.25 million recorded in February 2022.

    NUPRC stated this in its latest crude oil and condensate production data for March 2022.

    Vanguard learnt that the figure represents a 0.80 per cent decrease from the previous month, representing the lowest production capacity so far in the year. Nigeria is said to be producing below 1.4 million barrels per day in 2022, failing to meet its Organisation of Petroleum Exporting Countries (OPEC) quota of about 1.8 million bpd.

    The development is coming amid controversies surrounding the actual volume of oil that ended in the hands of illegal bunkers. The decline in oil output has also depleted revenue accrued to the federation account amid zero remittances from the Nigerian National Petroleum Company (NNPC) Limited despite soaring oil prices. Last March, Timipre Sylva, minister of state for petroleum resources, had outlined poor investment and the exit of oil majors as major issues affecting Nigeria’s inability to meet the oil production quota.

    NUPRC also stated that Nigeria lost more than 115,000 barrels per day (bpd) to oil theft and vandalism between January 2021 and February 2022, which amounts to $3.27 billion worth of crude oil.

    It will be recalled that last week, President Muhammadu Buhari asked the House of Representatives to adjust the 2022 fiscal framework to include an increase in the projected oil price benchmark, from $62 per barrel to $73 per barrel, up by US$11 per barrel. Buhari also asked for a reduction in the projected oil production volume by 283,000 barrels per day, from 1.883 million barrels per day to 1.6 million barrels per day.

    (Vanguard)

  • Oil price hits $80 per barrel

     

    Nigeria’s economy is in a dire strait as oil price hit $80.20 yesterday amid growing demand fuelled by a return to opening of economies around the world.

     

    However, the development has put Nigeria at crossroads. While the country makes more revenue from oil sales, the gains appear to be filtered away through fuel subsides as the country through the Nigerian National Petroleum Corporation( NNPC) imports 100 per cent of petrol consumed locally at 56 million litres daily

     

     

    According to data from the Nigerian National Petroleum Corporation (NNPC), the corporation incurred N756.99 billion petrol subsidy cost from January to July this year, a figure that may likely hit N1 trillion by December if oil price continues to rally.

     

    The surge may not be unconnected with Hurricane Ida’s landfall near Port Fourchon, Louisiana, as a Category 4 hurricane. As a result of the hurricane, 96 per cent of crude oil production and 94 per cent of natural gas production in the U.S. federally administered areas of the Gulf of Mexico (GOM) were shut in.

     

    According to estimates by the U.S. Department of Interior’s Bureau of Safety and Environmental Enforcement, at least nine refineries shut down or reduced production, leading to reduced forecast for crude oil production and refinery runs in September Short-Term Energy Outlook (STEO).

     

     

     

    The GOM accouns for 15 per cent of U.S. crude oil production. The International Energy Agency (IEA) reported that global oil demand will move to 108 million barrels per day(bpd), up from where it was before the COVID-19 pandemic.

     

    The Federal Government had in March 2020 removed petrol subsidy after reducing the pump price of the product to N125 per litre from N145 following the sharp drop in crude oil prices.

    The landing cost of petrol imported into the country increased to a new high of N249.42 per litre on July 30 from N240.17 per litre as of June 25.

     

    Data from the corporation showed that it incurred N25.37billion subsidy in January, N60.40billion in February, N111.97bn in March, and N126.30bn in April an d N114.34bn in May.

     

     

     

     

     

    Source: www.sunnewsonline.com

  • Nigeria produce 1.57 million barrels of oil per day

    Nigeria and several other members of the Organisation of the Petroleum Exporting Countries exceeded their oil production quotas in March, according to S&P Global Platts.

     

    Nigeria, which had also recently improved its compliance, saw a steady rise in its March exports.

     

    Nigeria produced 1.57 million barrels per day last month, a 30,000 bpd rise from February, and 70,000 bpd above its quota.

     

    Crude oil production from OPEC and its allies rose by 450,000 bpd in March, the latest S&P Global Platts survey found, as Russia and Iraq pumped well above their agreed caps, while quota-exempt members Iran and Libya also boosted output. In Libya’s case, its production hit an almost eight-year high.

     

    Iraqi compliance fell to 88 per cent in March, as it produced 3.95 million bpd, an increase of 60,000 bpd from the previous month.

     

    Despite a fall in exports, its crude inventories grew, survey panelists said. The March figure is almost 90,000 bpd above its OPEC+ production quota of 3.857 million bpd.

     

    Meanwhile, Angolan crude output recovered to 1.16 million bpd in March after its production had slumped to a 16-year low in February.

     

    OPEC’s 13 members pumped 25.20 million bpd in March, up 340,000 bpd from February, while their nine non-OPEC partners, led by Russia, produced 13.08 million bpd, a rise of 110,000 bpd, the survey found.

     

    With the production gains, OPEC+ compliance with its quotas slipped to 111 per cent in March, compared with 113.5 per cent in February, juiced by Saudi Arabia voluntarily cutting an additional 1 million bpd since January.

     

     

     

     

     

     

    Source: www.punchng.com

  • Crude Oil: NNPC sales of petroleum products increases by 92% in October 2020

     

    The Nigerian National Petroleum Corporation (NNPC) has announced that its downstream subsidiary, the Petroleum Products Marketing Company (PPMC), recorded a total of ₦158.04 billion from the sales of white products in the month of October 2020.

    The Corporation disclosed this on its October Monthly and Financial Operation Report (MFOR) in Abuja, on Thursday.

     

    It said the amount represented 92 per cent increase over the ₦80.15 billion sales in September 2020.

     

    The report indicated that total revenues generated from the sales of white products for the period October 2019 to October 2020 stood at ₦1.95 trillion, with Premium Motor Spirit (PMS) accounting for about 99.07 per cent of the total sales with a value of over ₦1. 9trillion.

     

    In terms of volume, the October 2020 sales figure translates to a total of 1.224.54 billion litres of white products sold and distributed by PPMC within the period compared with 603.39 million litres in the month of September 2020.

     

    This, it said, comprised 1.224.20 billion litres of PMS, 0.31 million litres of Automotive Gas Oil (AGO) also known as diesel and 0.033 million litres of Dual Purpose Kerosene (DPK).

     

    “Total sales of white products for the period October 2019 to October 2020 stood at 16.462.50 billion litres and PMS accounted for 16.344.36 billion litres or 99.28 per cent,’’ it said.

     

    On pipeline vandalism, it noted that 23 pipeline points were vandalised in the month under review, representing about 10 per cent increase from the 21 points recorded in September 2020.

     

    “ Of this figure, Mosimi area accounted for 83% of the vandalised points, while Port Harcourt Area accounted for the remaining 17 per cent,’’ it said.

     

    In the Gas Sector, the report revealed that a total of 214.07 billion Cubic Feet (bcf) of natural gas was produced in the month October 2020, translating to an average daily production of 6,908.34 Million Standard Cubic Feet per Day (mmscfd).

     

    It noted that the daily average natural gas supply to power plants increased by 8.60 per cent to 745mmscfd, equivalent to power generation of 2,801 Megawatts.

     

    “For the period of October 2019 to October 2020, a total of 3,018 BCF of gas was produced, representing an average daily production of 7,658.88 mmscfd during the period,’’ it said .

     

    The MFOR also indicates that period-to-date gas production from Joint Ventures (JVs), Production Sharing Contracts (PSCs) and NPDC contributed about 68.18 per cent , 20.12 per cent and 11.70 per cent respectively to the total national gas production.

     

    It adds that in terms of natural gas off take, commercialisation and utilisation, out of the 208.96 BCF of gas supplied in October 2020, a total of 118.40 BCF of gas was commercialised, consisting of 38.07 BCF and 88.90 BCF for the domestic and export market respectively.

     

    This, it said, translated to a total supply of 1,269.03mmscfd of gas to the domestic market and 2,870.57mmscfd of gas supplied to the export market for the month.

     

     

     

    Source: www.vanguardngr.com

  • Crude Oil: Nigerian refineries lose a total of 152.08bn

     

    The nation’s refineries lost a total of N152.08bn in 15 consecutive months of being idle, the latest data from the Nigerian National Petroleum Corporation have shown.

    Analysis of data collated from NNPC monthly reports revealed that all the refineries did not refine crude oil from July 2019 to September 2020.

     

    The refineries, which are located in Port Harcourt, Kaduna and Warri, have a combined installed capacity of 445,000 barrels per day but have continued to operate far below the installed capacity.

     

    The country relies largely on importation of refined petroleum products as its refineries have remained in a state of disrepair for many years despite several reported repairs.

     

    In 2019, Kaduna Refining and Petrochemical Company only processed crude in one month, June; Port Harcourt Refining Company in two months (February and March); and Warri Refining and Petrochemical Company in four months (January, February, March and May).

     

    The Kaduna refinery incurred an operating deficit of N57.99bn from July 2019 to September 2020, according to the NNPC data.

     

    Port Harcourt refinery lost N48.99bn in the period under review while the Warri refinery lost N45.10bn.

     

    The NNPC said in its latest monthly report that the declining operational performance of the refineries ‘is attributable to ongoing revamping of the refineries, which is expected to further enhance capacity utilization once completed’.

     

    The Group Managing Director, NNPC, Mallam Mele Kyari, has reiterated its plan to revamp the refineries and end fuel importation by 2023.

     

    Bloomberg reported on January 15 that a year after shutting down all of its dilapidated refineries to figure out how to fix them, Nigeria still could not say how much it would cost to do the work or where the money would come from.

     

    According to the report, the NNPC said it had finished the appraisal of its largest facility, but hadn’t completed the process at two others.

     

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    The international news agency quoted refining experts as saying that the extended halt meant the plants were at risk of rotting away and unlikely to restart on time.

     

    It noted that the NNPC had totally shut all three plants down by January 2020 to do a comprehensive appraisal, and set the ambitious target of having them all back up and running at 90 per cent of capacity by 2023.

     

    The NNPC spokesman, Dr Kennie Obateru, was quoted as saying that the appraisal of the 210,000-bpd Port Harcourt refinery had been completed and the NNPC had called for bids for the necessary repairs.

     

    “It is when we close the bids, everything is analysed and presented that we will know how much we need,” he said.

     

    He said the diagnosis was underway at the 125,000bpd Warri facility and should be complete before the end of the year, adding that after that, the study of the 110,000b pd Kaduna plant would commence.

     

     

    Source: www.punchng.com

  • NNPC: Nigeria generated $120.49m in September from oil exports

    The Nigerian National Petroleum Corporation on Sunday announced a total export receipt for crude oil and gas valued at $120.49m for the month of September 2020.

    NNPC’s Group General Manager, Group Public Affairs Division, Kennie Obateru, said the figure was contained in the September 2020 edition of the corporation’s Monthly Financial and Operations Report.

    He said in a statement issued in Abuja that the $120.49m crude oil and gas export receipt was a 16.28 per cent improvement on the $100.88m posted in August 2020.

    The report showed that out of the figure, proceeds from crude oil amounted to $85.40m, while gas and miscellaneous receipts stood at $25.31m and $9.78m respectively.

    The September 2020 MFOR also indicated a trading surplus of N28.38bn, lower than the N29.6bn surplus in August 2020.

    The reduction in surplus, according to the report, was as a result of lower contribution from the Nigerian Petroleum Development Company, which recorded zero crude oil lifting from the Okono Okpoho facility during the month due to ongoing repairs.

    Other NNPC subsidiaries including the Integrated Data Services Limited, National Engineering and Technical Company Limited, Nigerian Gas Marketing Company, Petroleum Products Marketing Company and NNPC Retail recorded 268, 234, 21, 422 and 41 per cent trading surpluses respectively over their previous month’s performance.

    In the gas sector, a total of 223.82 billion cubic feet of natural gas was produced in the month under review, translating to an average daily production of 7,460.8 million standard cubic feet per day.

    From September 2019 to September 2020, a total of 3,039.05bcf of gas was produced, representing an average daily production of 7,730.35mmscfd during the period.

    Period-to-date production from Joint Ventures, Production Sharing Contracts and NPDC contributed about 69.1 per cent, 20.29 per cent and 10.61 per cent respectively to the total national gas production.

    Out of the 221.91bcf of gas supplied in September 2020, a total of 140.45bcf was commercialised, consisting of 36.37bcf and 104.08bcf for the domestic and export markets respectively.

    This translates to a total supply of 1,212.17mmscfd of gas to the domestic market and 3,469.45mmscfd of gas supplied to the export market for the month.

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    This implies that 63.29 per cent of the average daily gas produced was commercialised, while the balance of 36.71 per cent was re-injected, used as upstream fuel gas or flared.

    Gas flare rate was 6.66 per cent for the month under review, representing 492.93mmscfd when compared with average gas flare rate of 5.84 per cent i.e. 439.90mmscfd for the period of September 2019 to September 2020.

     

    To ensure effective supply and distribution of Premium Motor Spirit across the country, a total of 0.59 billion litres of PMS translating to 19.59 million litres/day was supplied for the month in the downstream sector.

    During the period under review, 21 pipeline points were vandalised. This represents about 43 per cent decrease from the 37 points recorded in August 2020.

    Of this figure, Mosimi Area accounted for 90 per cent of the vandalised points, while Port Harcourt Area accounted for the remaining 10 per cent.

    The NNPC stated that it was collaborating with the local communities and other stakeholders to reduce and eventually eliminat e the menace of pipeline vandalism.

     

    Source: www.punchng.com

  • Nigeria’s crude oil production fell from 1.33 million to 1.17 million barels per day

    Crude oil production in Nigeria tumbled by 155,000 barrels to a record low in December amid the production cuts by the Organisation of the Petroleum Exporting Countries and its allies.

    OPEC disclosed this on Thursday in its report for January, saying a meaningful rise in oil prices would brighten Nigeria’s economic outlook this year.

    The report showed that the country’s oil production fell to 1.17 million barrels per day in December 2020, from 1.33 million bpd in November, based on direct communication.

    According to secondary sources, total crude oil production by the 13-member OPEC averaged 25.36 million bpd in December, up by 280,000 million bpd in the previous month.

    “Crude oil output increased mainly in Libya, Iraq and the UAE, while production decreased primarily in Nigeria, Congo and Angola. Libya’s crude oil output in December rose to 1.22 million bpd, according to secondary sources,” the group said.

    OPEC and its Russia-led allies, a group known as OPEC+, have been curbing output to support prices and reduce oversupply since January 2017.

    The international oil benchmark, Brent crude, rose by $0.27 to $56.33 barrels per day as of 7:30pm Nigerian time on Thursday.

    OPEC noted in the report that Nigeria’s economy entered a recession in the third quarter of 2020 with real GDP contracting by 3.6 per cent year-on-year after a sharp contraction of 6.1 per cent y-o-y in Q2.

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    “In the meantime, a meaningful rise in oil prices following the recent DoC (Declaration of Cooperation) decisions along with a positive trajectory from COVID-19 vaccines would brighten the 2021 outlook and lay the groundwork for a hopeful medium-term real GDP expansion,” it said.

    The group said oil demand was estimated to have improved toward the end of 2020, mainly due to successful containment measures in major consuming countries in the region.

     

    Source: www.punchng.com

  • Crude Oil : Price of Oil hits $56

     

    The sustained increase in global crude oil prices has pushed up the landing cost of imported petrol closer to the current pump prices of the product in Nigeria, and appears to have triggered a return to petrol subsidy era, ’FEMI ASU reports

    Since November 13, 2020 when the pump prices of Premium Motor Spirit (petrol) were last increased in the country, the price of the international oil benchmark, Brent crude, has been on an upward trajectory, rising from $41.51 per barrel to close at $51.22 per barrel on December 31.

    Fuel marketers had in December expected another upward adjustment of PMS prices to reflect the further rise in crude oil prices.

    However, a N5 reduction in petrol price, effective December 14, was announced by the Federal Government – a development that left them reeling in shock and questioning the deregulation of petrol price.

    Crude oil price accounts for a large chunk of the final cost of petrol, and the country has continued to spend so much on petrol imports for many years amid low domestic refining capacity.

    The Minister of State for Petroleum Resources, Timipre Sylva, had said in September last year that the Federal Government had stepped back in fixing the price of petrol, adding that market forces and crude oil price would determine the cost of the product.

    The Federal Government removed petrol subsidy in March 2020 after reducing the pump price of the product to N125 per litre from N145 on the back of the sharp drop in crude oil prices. The price reduction lasted till June.

    Nigerians saw increases in the pump prices of petrol in four months, rising from N121.50–N123.50 per litre in June to N140.80-N143.80 in July, N148-N150 in August, N158-N162 in September and N163-N170 in November.

    Brent, the international oil benchmark, has risen by about 35 per cent since November 13 when the pump price of petrol was last increased. It closed at $55.99 per barrel on Friday, its highest level in 11 months.

    Going by the petrol pricing template of the Petroleum Products Pricing Regulatory Agency, the landing cost of petrol rose from an average of N143.60 in December to N158.53 per litre on January 7, with the expected open market price (retail price) being N181.53 per litre.

    The product is currently being sold at between N160 and N165 per litre at many filling stations in Lagos.

    The cost of petrol quoted on Platts rose to $480.25 per metric tonne (N139.67 per litre, using N390/$1) last Thursday from an average of $430.107 per MT (N125.09 per litre) in December. The cost of petrol averaged $391.75 per MT (N113.24 per litre) in July, according to PPPRA’s template.

    Apart from the increase in global crude oil prices, the devaluation of the naira last year also led to a significant rise in the cost of imported petrol.

    The PPPRA used an exchange rate of N306.90/$1 on January 14, 2020 to calculate the cost of petrol, while N387.63/$1 was used on July 31.

    The naira closed at 393.50 against the dollar on Friday at the Investors’ and Exporters’ Foreign Exchange Window, and 472/$1 at the parallel market.

    As of January 7, the cost of petrol plus freight stood at $500.72 per MT, translating to N145.62 per litre.

    Other cost elements that make up the landing cost include lightering expenses (N4.57), insurance cost (N0.21), Nigerian Ports Authority charge (N2.38), Nigerian Maritime Administration and Safety Agency charge (N0.23), jetty throughput charge (N1.61), storage charge (N2.58), and financing (N1.33).

    The pump price is the sum of the landing cost, wholesale margin and the distribution margins. The wholesale margin is N4.03 while the distribution margins comprise transporters allowance (N3.89), retailer (N6.19), bridging fund (N7.51), marine transport average (N0.15), and admin charge (N1.23).

    The NNPC, which has been the sole importer of petrol into the country in recent years, is still being relied upon by marketers for the supply of the product despite the deregulation of the downstream petroleum sector.

    Private oil marketing companies have continued to lament that their inability to access foreign exchange at the official rates has hampered efforts to resume petrol importation.

    If the pump price of petrol is left unchanged amid the rise in oil prices, it means the NNPC would again bear the latest subsidy cost on behalf of the government as it did for several years before its removal last year.

    There is currently subsidy, but it is being absorbed by the government through the NNPC,” the National Operation Controller, Independent Petroleum Marketers Association of Nigeria, Mr Mike Osatuyi, told our correspondent.

     

    He recalled that he said in December that petrol pump price was moving closer to N180 per litre, adding that with the current price of crude oil, petrol subsidy would gulp about N800m daily with an average consumption level of 40 million litres.

    He said, “Because of the volatility of petrol in the Nigerian political landscape, government does not have the boldness to allow full deregulation of petrol because of the spiral effects on Nigerians, and bearing in mind that Nigerians are in very hard times.”

    Osatuyi said, “But the government is supposed to come out and present the subsidy to the National Assembly. They should tell Nigerians that we are going back to subsidy. But because of the loans from the IMF and World Bank that they got with the condition that petrol should be deregulated, I believe the government is trying to manage the problem.

    “If we are going to do genuine deregulation, there must be a level playing field for the players. We are not where we are supposed to be; there is still some dark, hidden elements in our ‘deregulation’.

    “We are practising monopolistic deregulation – where one player is on the field and it is the goalkeeper, the defender and the referee.”

    The President, Petroleum Products Retail Outlets Owners Association of Nigeria, Dr Billy Gillis-Harry, stressed the need for deregulation to be properly done.

    He said, “The concern I have is that we are not getting it right. We must think inwards and grow our local production capacity. I don’t know why our refineries should not work.

    “Deregulation is the way to go; we want the sector to be deregulated. But we need to do it rightly. There should be a level playing field for all operators; everybody should be able to access forex at the same rate.”

    While opposing the return to subsidy, he said, “We call on the government to fast-track the regulatory process to ensure that deregulation is in place.”

     

    The Source had reported on September 8, 2020 that the Federal Government’s removal of petrol subsidy and the increase in electricity tariff were in line with reforms being sought by the International Monetary Fund and the World Bank.

    “The recent introduction and implementation of an automatic fuel price formula will ensure fuel subsidies, which we have eliminated, do not reemerge,” the Federal Government told the IMF in the letter of intent dated April 21, 2020 with respect to its request for emergency financial assistance of $3.4bn.

    In July, Sylva said in a statement that the Federal Government had reached  a conclusion that it could no longer bear the burden of petrol subsidy.

     

    Source : www.punchng.com

  • Crude Oil : Nigeria’s oil export revenue increases as the price of a barrel rises above $55

     

    The international oil benchmark, Brent crude, extended its gains on Friday, rising above $55 per barrel, in what is a potential boost to Nigeria’s crude oil export revenue.

     

    Brent crude, against which Nigeria’s oil is priced, hit an 11-month high of $55.41 per barrel as of 2:50pm Nigerian time on Friday, trading more than $15 higher than the Federal Government’s benchmark for the 2021 budget.

     

    The 2021 budget, which was signed by the President, Major General Muhammadu Buhari (retd.), on December 31, was based on an oil price benchmark of $40 per barrel and a production level of 1.86 million barrels per day.

     

    The upturn in oil prices was supported by Saudi Arabia’s pledge to cut output and a global stocks rally as investors looked beyond rising coronavirus cases, according to Reuters.

     

    “The surprise Saudi cut is keeping bulls at the helm. It will take a brave man to bet against the current bullish run of play,” said Stephen Brennock of oil broker PVM.

     

    Saudi Arabia this week pledged extra, voluntary oil output cuts of one million barrels per day in February and March as part of a deal under which most OPEC+ producers will hold production steady in the face of new coronavirus lockdowns.

     

    However, analysts said oil prices could see a correction in coming months, if their rallies were not backed by stronger fuel demand.

     

    Severe mobility restrictions around the world to contain a surge in COVID-19 cases still weighed on fuel sales, weakening the prospect of energy demand recovery in the first half of 2021.

     

    “Oil markets are expected to stay in a bullish tone towards February,” said Kazuhiko Saito, chief analyst at commodities broker Fujitomi Co.

     

    “But concerns over slower demand in gasoline and other fuels in the United States and other parts of the world due to wider restrictions to contain the spreading COVID-19 pandemic may limit gains.”

     

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    The pandemic claimed its highest US death toll yet, killing more than 4,000 people in a single day, while China reported the biggest rise in daily cases in more than five months and Japan may extend a state of emergency beyond the greater Tokyo region.

     

    A rally in global shares also lent some support to oil prices, with Japan’s Nikkei hitting a three-decade peak, as investors looked beyond rising coronavirus cases and focused on hopes for an economic recovery later in the year.

     

    As a sign of tighter supply following Saudi Arabia’s cut, seven North Sea crude cargoes were bought and sold in the trading window operated by Platts on Thursday. Normally, just one or two cargoes change hands each day.

     

    Source : www.punchng.com