Nigeria is still struggling to increase its crude oil production despite the lull in militant attacks on oil installations in the Niger Delta. Data from the Organisation of Petroleum Exporting Countries (OPEC) for December 2016 shows that Nigeria recorded an average crude oil production of 1.45 million b/d, well below its 2.2 million b/d day quota and below the average of 1.69 million b/d exported in November 2016. The significant drop in production was due to the continued shut down of the Forcados pipeline because of the suspected attack by the Niger Delta Avengers in November, and ongoing maintenance work on the Agbami oil field as well as the Erha field.

A fire outbreak at the Shell Petroleum Development Company’s (SPDC) Trans Niger Pipeline on 3 January, a strike called by the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) at Total’s operations – which has since been suspended – as well as continuous maintenance work on oil fields, will further delay cargo deliveries and ensure Nigeria’s crude oil production remains below 1.9 million b/d in January and February. NUPENG has also threatened to embark on a 3-day warning strike on 11 January over the sacking of some of its members. This will further disrupt crude oil production activities in the country.

The low production levels means that the country will not take full advantage of its exemption from OPEC’s agreed production cuts and the new higher crude oil price until March. This will have a significant impact on the government’s revenue projections and the outlook for the Nigerian economy, which has turned positive based on expectations that the country will be able to raise crude oil production.