OPEC deal: Nigeria not opposed to cutting production – Kachikwu

The Minister of State for Petroleum Resources, Dr Ibe Kachikwu, has expressed his support for a nine-month extension of the deal reached late last year in which the Organisation of Petroleum Exporting Countries and 11 non-members agreed to cut oil output to stem the supply glut in the market and revive prices.

The oil producers agreed in December to cut output by 1.8 million barrels per day for six months from January 1, 2017. But Nigeria and Libya were exempted from the cuts because their production had suffered disruptions on the back of unrest and militant attacks.

OPEC is meeting in Vienna, Austria, today to consider whether to prolong the original deal reached in December.

Kachikwu, in an interview with Bloomberg TV ahead of the meeting, said Nigeria was not opposed to joining the production cuts in a bid to prop up oil prices.

He, however, said the nation’s oil production was still hovering around 1.5 million bpd, down from around 2.2 million bpd, as a lot of the pipelines affected by militant attacks had yet to be repaired.

“Our numbers don’t justify us joining the pack yet. But quite frankly when we do, the pressure is going to get on for us to join the cut team. And Nigeria is not averse to that because I think everybody needs to make the necessary sacrifice to help the price stability on a worldwide basis,” the minister said.

Kachikwu said, “Certainly, I support the nine months’ (extension) straight up because I think it gives a longer gestation period to see how prices move, how stocks stay, and how the reserves in most countries are holding up.

“I am not as aggressive as some of my colleagues are. I am looking at rebalancing more in the first quarter of next year. That is why I am more supportive of the nine months’ agenda.”Punch