Oil output cut: Nigeria supports 9-month extension

Nigeria on Monday reaffirmed its strong support for the nine-month extension of oil production cut under the “Declaration of Cooperation’’, which seeks to improve global oil market stability among members of the Organization of the Petroleum Exporting Countries (OPEC)

Under the cooperation, OPEC members, OPEC+ members, and non-member countries accelerated the stabilisation of the global oil market through voluntary production adjustments amounting to 1.8 million barrels per day.

Dr. Folashade Yemi-Esan, Head of the Nigerian Delegation to the 176th Meeting of OPEC, stated this at a news conference in Vienna while welcoming the commitment by Saudi Arabia and Russia on the proposed extension.

“Nigeria strongly endorses this commendable commitment and support this position, we believe that an extension of nine months is preferable to six months, as it offers greater certainty to the market, thereby reducing market volatility,” he said.

She said that the nation recognized the transformational impact which the ‘’declaration of Cooperation’’ has had on global oil market with 24 oil producing countries working together and contributing to improved market stability.

Yemi-Esan who is the Permanent Secretary of the Petroleum Resources ministry noted that the development had benefited consumers and producers as well as impacted positively on health of the global economy.

She further expressed the nation’s commitment to the declaration saying that “we will work to stabilise production by improving security in oil producing regions through continued engagement with local communities’’.

The News Agency of Nigeria (NAN) recalls that the nation was exempted from the declaration in December 2016 when it was first signed owing to the security challenges in the Niger Delta at the time and difficulties in meeting up the voluntary production adjustment.

In the same development, Mr Bala Wunti, representative of Mr Mele Kyari, the newly appointed Group Managing Director, Nigeria National Petroleum Corporation (NNPC) noted that pricing and volume of products remained key factors in ensuring sustainable revenue generation for the country.

“Through the Declaration of Cooperation, greater stability is restored globally, Nigeria believes that having the right price and volume can support our aspiration and ensure a sustainable revenue generation.

“’We believe that continuation of the declaration is the way to go. A Six month extension is too short a time and will not have the required impact in curbing uncertainty and volatility which existed before the cooperation.

“So a nine-month extension is the way to go considering the objective of the declaration, that is why Nigeria supports the initiative and is also grateful that big nations are committed to it,’’ Kyari.

He further expressed the commitment of the NNPC in revamping refineries, noting that in-country refining of crude through multiple channels and collaboration would ensure the nation becomes a major petroleum product exporter by 2020.

According to him, that is the vision of the incoming NNPC chief, and that is the vision of Nigeria.

The news conference was attended by the media, analyst and experts in the petroleum sector.