Nigeria’s Rig Count Depletes by Five as OPEC Slides by 11

-By Gideon Osaka

The coronavirus pandemic, otherwise known as Covid-19, which has ravaged the world economy has continued to take its toll on oil production in Nigeria, as the country’s rig count dipped by five, having recorded 16 in April as against 21 recorded in March, data from the Organisation of Petroleum Exporting Countries, OPEC, shows.

This is happening at a time OPEC rig count showed minus 11, having recorded 561 in April as against 572 recorded in March, while world rig count showed a dismal minus 448, after presenting 1,674 figure in April, as against 2,122 shown the previous month. Among OPEC members, Venezuela led the losers pack with 11, as it recorded 14 in April as against 25 recorded in March. Iraq came third in the losers block with minus four, having recorded 70 in April as against 74 recorded the previous month. This was followed by the United Arab Emirates (UAE), which had minus three, having recorded 65 as against 68 recorded within the period under review. Gabon’s rig count decreased by two, as it had six in April, as against eight recorded in March, while Libya had a decrease of one, as its rig count showed 10 as against 11 posted within the period under review.
On the gainers side, Algeria led by an impressive eight, as its rig count showed 42 as against 34 within the period under review, Kuwait came second with four, having recorded 54 as against 50 recorded within the period under review. Saudi Arabia had a decrease of two as its rig count showed 116 in April as against 114 in March. Angola had its rig count increase by one as it recoded seven in April as against six recorded the previous month. Three OPEC members had their rig count unchanged within the period under review. They are Congo, Equatorial Guinea and Iran whose rig count remained at two, two and 157 respectively.

OPEC Crude Oil Production
Total OPEC-13 preliminary crude oil production was said to have averaged 30.41 million barrels daily, mb/d in April, higher by 1.80 mb/d month-on month (m-o-m). Crude oil output increased mainly in Saudi Arabia, the UAE, and Kuwait, while production decreased primarily in Angola, Nigeria, IR Iran, and Iraq. In addition to the agreed production adjustments that should take effect as of 1 May 2020, on 12 May, Saudi Arabia, the UAE and Kuwait announced that they would voluntarily deepen oil output adjustments from June, by 1 mb/d, 100 thousand barrels daily, tb/d and 80 tb/d, respectively, in an effort to expedite draining a global supply glut and rebalancing the oil market.

Non-OPEC liquids production growth in 2020 (including processing gains) has been revised down by a huge 2.0 mb/d from the previous assessment and is now forecast to decline by 3.5 mb/d to average 61.50 mb/d in 2020. The revision is based on production shut-ins or curtailment plans announced by companies, including the majors, particularly in North America.

Globally, not including the production adjustments of the countries participating in the Declaration of Cooperation (DoC), and as of 6 May 2020, around 3.6 mb/d of production adjustments have so far been announced. The 2020 oil supply growth forecast for the US was revised down by 1.3 mb/d to show a decline of 1.4 mb/d year-on-year (y-o-y). Of the total revision, 0.9 mb/d was attributed to production shut-ins for the year. Other large downward revisions were made for Canada and Brazil by 0.3 mb/d and 0.1 mb/d, respectively. Oil supply in 2020 is now forecast to grow only in Norway, Brazil, Guyana and Australia.