BREAKING: Nigerians To Lament More As Strong Reason To Push Fuel And Diesel Prices Up Emerge

BREAKING: Nigerians To Lament More As Strong Reason To Push Fuel And Diesel Prices Up Emerge

The Nigerian government may find itself increasing subsidies for Premium Motor Spirit (PMS) as oil prices surged yesterday, following forecasts of reduced supply from the Organisation of Petroleum Exporting Countries (OPEC).

With diesel and aviation fuel already inching towards N1,000 per litre, there are signs of tougher times ahead for businesses, particularly in the manufacturing and aviation sectors.

This development coincided with OPEC’s monthly report for August, released yesterday, which indicated that Nigeria’s crude oil production averaged 1.181 million barrels per day, marking a 100,000 barrel increase compared to July’s output.

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Despite the potential windfall from the high oil prices, which reached a 10-month peak at $92.28 a barrel, Nigeria’s inability to refine locally and ramp up production has posed challenges.

Anticipating robust growth in global oil demand for 2023 and 2024 due to the recovery of major economies, OPEC projected a rise of 2.25 million barrels per day in world oil demand by 2024.

“Crude prices are rallying after the OPEC’s monthly report showed the oil market is going to be a lot tighter than initially thought,” remarked Edward Moya, senior market analyst at data and analytics firm, OANDA.

While Saudi Arabia extended its voluntary 1.3 million barrels per day cut, most OPEC countries, including Nigeria, are falling short of meeting their production quotas. Last week, Libya had to shut down four of its eastern oil export terminals due to a storm, and Kazakhstan’s daily oil output has also dropped to 213,800 metric tons.