Nigeria Faces Likely Oil Output Drop As Exxon Suspends Exports
The suspension has added to economic strains from renewed activities of militants in the Niger Delta region that have cut production to its lowest in decades.
Reuters quoted Exxon Mobil as saying on Friday that it had declared a force majeure – a suspension of deliveries because of events beyond its control – on Nigeria’s Qua Iboe crude oil grade BFO-QUA, and that a portion of production had been curtailed after a drilling rig damaged a pipeline.
Last week, Chevron’s platform in the Delta was attacked by militants.
The outages adds to production problems at two of the other largest crude streams, Bonny Light and Forcados, which have already taken Nigeria’s output to a 22-year low.
Royal Dutch Shell shut a major pipeline earlier this week and declared force majeure on Bonny Light crude exports on Wednesday, while an attack in February on a pipeline also caused it to shut the 250,000 barrels per day Forcados export terminal.
Nigeria’s oil production has fallen to 1.65 million barrels per day (bpd) due to militant attacks, Finance Minister Kemi Adeosun, said on Friday, from 2.2 million bpd.
According to Reuters calculations, if outages at Qua Iboe and other streams are prolonged, Nigerian output could fall to around 1.2 million bpd.
This would be the lowest output since 1970, according to BP’s statistical review.
Nigeria had been Africa’s largest crude exporter with its economy heavily reliant on oil up until this year, when rampant oil theft and corruption has kept production well below capacity.
As a result, Angola has overtaken Nigeria as the continent’s largest producer since March, according to OPEC figures.
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