AGS NEWS – The continuous decline in Nigeria’s monthly oil production since January 2024 has led to a revenue loss of approximately N636.3 billion, according to findings by Sunday PUNCH.

Data from a Federal Government agency revealed that Nigeria produced 1.43 million barrels of crude oil (excluding condensates) in January, but this figure dropped to 1.25 million barrels per day in May.

The Nigerian Upstream Petroleum Regulatory Commission reported that the total volume of crude produced in January was 44.22 million barrels, which decreased to 38.8 million barrels in May.

This indicates a production drop of 5.43 million barrels between January and May 2024.

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In January, the average price of Brent crude oil, the global benchmark, was $80.12 per barrel, rising slightly to $81.75 per barrel in May, according to Statistica, an international statistical firm.

The average exchange rate of the naira against the dollar in May was 1,434.1/$. The naira has struggled since the Central Bank of Nigeria harmonized the country’s foreign exchange markets on June 14, 2023.

Considering the drop in crude oil production, the price of Brent, and the exchange rate of the naira in May, Nigeria lost an estimated revenue of around N636.3 billion between January and May this year.

Further analysis showed that Nigeria’s oil production dropped from 1.43 million barrels per day in January to 1.32 million barrels per day in February, 1.23 million barrels per day in March, increased slightly to 1.28 million barrels per day in April, and then fell again to 1.25 million barrels per day in May.

The decline in oil production has been attributed to ongoing pipeline vandalism and crude oil theft. The government has been attempting to tackle these issues, but success has been limited.

On June 13, 2024, the Nigerian National Petroleum Company Limited (NNPC) called on the judiciary to establish a special court to prosecute those involved in oil theft and pipeline vandalism.

NNPC’s Group Chief Executive Officer, Mele Kyari, made this appeal during the National Judges Capacity Building Workshop on the Petroleum Industry Act 2021 in Abuja.

He also urged the judiciary to expedite hearings on such offences.

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Major oil companies have expressed concerns over the impact of oil theft and pipeline vandalism on the availability of crude for local refineries.

The Director-General of the Lagos State Chamber of Commerce and Industry, Dr. Chinyere Almona, noted that these issues prevent oil majors from meeting their daily quotas and affect modular refineries’ ability to secure enough crude.

She also pointed out that low crude oil production in Nigeria limits the capacity of international oil companies to supply crude to the Dangote Petroleum Refinery and other modular refineries.