-By Fred Ojiegbe
Nigeria’s rig count for the month of March witnessed reduction by one, having recorded six as against seven recorded in February, data from the Organisation of Petroleum Exporting Countries (OPEC) Monthly Oil Market report (MOMR) showed.
On the contrary, OPEC rig count increased by one, as its March result showed 355 against 354 posted in February.
However, world rig count suffered reduction by 42, having posted 1,339 in March against 1,381 it posted in February.
Among the 13–member OPEC, Algeria led the gainers’ pack with its plus three rig count, having posted 25 against 23 it recorded within the period under review.
Iraq also had plus three, as it posted 34 against 31 it posted within the period under review.
Saudi Arabia, with its minus three, led the losers’ pack, as its rig count showed 60 against 63 it posted within the period review.
Kuwait has minus one, as it recorded 27 against 28 it posted within the period under review.
Eight OPEC members had their rig counts unchanged, including: Angola, Congo, Equatorial Guinea, Gabon, Iran, Libya, United Arab Emirates and Venezuela recorded 4, 0, 0, 1, 117, 12, 44 and 25, respectively.
As regards non OPEC members, the United States has plus 11, as it recorded 408 in March against 397 it recorded the previous month.
Canada had a huge loss of 63, as it recorded 108 in March against 171 it recorded the previous month.
Mexico had minus 2, as its rig count for March showed 44 against 46 it recorded in February.
Similarly, Norway had its rig count dip by four, as it posted 14 against 18 it posted within the period under review.
The United Kingdom had its rig count unchanged, as it remained at nine.
The Organisation for Economic Co-operation and Development (OECD) Americas had a huge loss of 55, having recorded 561 in March against 616 it recorded in February.
OECD Europe had minus one, as its rig count showed 55 in March against 56 recorded in February.
OECD Asia Pacific had minus two, having recorded 18 as against 18 it recorded within the period under review.
Non-OPEC 2020 Supply Revised up by 42tbpd – MOMR Report
According to the MOMR report, Non-OPEC liquids supply for 2020 is revised up by 42,000 barrels per day (tbpd), and estimated to have declined by 2.52 million (mbpd) year-on-year (yoy) to average 62.89 mbpd.
US crude and condensate output declined by 0.94 mbpd yoy to average 11.3 mbpd, while liquids production dropped by 0.8 mb/d y-o-y to average 17.62 mbpd.
Oil supply also declined in Russia by 1.0 mbpd to average 10.59 mbpd.
Moreover, production declined in Canada, Colombia, Kazakhstan, Malaysia, the UK and Azerbaijan, while oil supply is estimated to have increased in Norway, Brazil, China and Guyana.
Non-OPEC liquids supply for 2021 is also revised up by 24 tbpd to average 63.83 mbpd.
In terms of growth, however, it was revised down by a slight 18 tbpd, and is now forecast to grow by 0.93 mbpd yoy.
The pandemic-driven crash in oil prices in 2020 caused investors to shy away from the shale industry, forcing companies to look at asset sales and mergers for survival.
However, while most drillers continue to focus on paying off debt and returning capital to shareholders instead of pursuing growth, higher prices could translate into higher production levels.
The drilling and completion trend indicates upcoming robust monthly growth.
Active drilling rigs in the US climbed by 13 rigs, reaching 430 rigs for the 17th increase in the past 19 weeks.
The US liquids supply growth forecast remained unchanged at 0.16 mbpd.
However, tight crude output is forecast to decline yoy by 0.1 mbpd, while uncertainties persist.
Activity and spending in US oil fields are rising this year as the industry recovers from last year’s Coronavirus (COVID-19) pandemic-driven price crash, according to energy company executives polled by the Federal Reserve Bank of Dallas in a recent survey.
Nevertheless, following a drop of $144 billion yoy in capital expenditure in oil and gas upstream (exploration and production) sectors in non-OPEC countries, upstream capital spending in 2021 is expected to remain well below 2019 levels.
The main drivers for supply growth for 2021 are expected to be Canada, the US, Norway and Brazil.
OPEC non gas liquids (NGLs) and non-conventional liquids production in 2020 is estimated to have declined by 0.13 mbpd yoy at 5.13 mbpd.
For 2021, OPEC NGLs are forecast to grow by 0.08 mbpd yoy to average 5.21 mbpd.
OPEC crude oil production in March was up by 0.20 mbpd month-on-month (mom) to average 25.04 mbpd, according to secondary sources.
Preliminary non-OPEC liquids output in March, including OPEC NGLs, is estimated to have increased by 0.93 mbpd mom, mainly in the US, due to production recovery after heavy declines in February.
As a result, preliminary data indicated that global oil supply increased in March by 1.22 mbpd mom to average 93.23 mbpd, down by 7.22 mbpd yoy.