Nigeria’s average crude oil production fell to 1.25 million barrels per day (bpd) in May 2024, down from 1.28 million bpd in April, marking a decrease of 30,000 bpd and the second-lowest production level for the year. This data comes from the OPEC Monthly Oil Market Report (MOMR) for May, which recorded a total crude oil supply by OPEC+ members at 40.9 million bpd, sources revealed.
Despite the low production, Nigeria maintained its position as Africa’s largest crude oil producer, ahead of Angola and Libya. The only month with lower production in 2024 was March, with 1.23 million bpd.
Interestingly, other secondary sources noted an increase in Nigeria’s crude oil production by 74,000 barrels, from 1.34 million bpd to 1.41 million bpd in May, aligning with a Reuters survey that reported a 50,000 bpd increase.
Global crude oil demand in May remained stable at 2.2 million bpd, with projections for daily demand to reach 104.5 million bpd in 2024. However, the OPEC Reference Basket (ORB) saw a price decline of $5.53, or 6.2%, to an average of $83.59 per barrel, and oil futures prices also fell, with the ICE Brent front-month contract decreasing by $6.00, or 6.7%, to an average of $83.00 per barrel.
Nigeria’s crude oil production decline underscores the sector’s inconsistent performance as the country strives to meet its OPEC production quotas and 2024 budget benchmarks. May marked the fifth consecutive month Nigeria failed to meet these targets, impacting projected revenue despite crude oil prices remaining above the 2024 budget benchmark of $78 per barrel.
The reduction in production not only affects earnings from oil sales but also has led to a continued decrease in Nigeria’s OPEC quota. In 2023, the country missed its OPEC production quota of 1.7 million bpd, leading to a reduction to 1.5 million bpd for 2024. Recently, at the Joint Ministerial Monitoring Committee (JMCC) meeting, OPEC+ set Nigeria’s crude oil production quota at 1.5 million bpd for 2025, despite the country’s target of reaching 2 million bpd.
