Despite efforts by the Organisation of Petroleum Exporting Countries (OPEC) to stabilise the cost of the commodity, the global crude oil price dropped on Sunday to about $86/barrel.
The September 2022 OPEC’s Oil Market Report indicted that an oil rig in Nigeria was dormant in August 2022 when compared to the number of functional rigs in the preceding month.
Industry figures seen in Abuja on Sunday showed that Brent, the global industry benchmark for crude, dropped in price by $4.31 or 4.76 per cent to $86.15/barrel as at 4.18pm Nigerian time.
WTI crude lost $4.75 or 5.69 per cent to close at $78.74/barrel, while the cost of oil grades in OPEC Basket dropped marginally by $0.24 or 0.25 per cent to close at $96.31/barrel.
OPEC stated that in 2019, the average number of functional oil rigs in Nigeria was 16, but this dropped to 11 in 2020, before eventually crashing to seven in 2021.
In the first and second quarters of 2022, the average number of Nigeria’s functional oil rigs was put at eight and 10 respectively.
OPEC’s data indicated that the functional rigs increased to 11 in July this year, but this was not sustained, as it again dropped to 10 in the succeeding month of August.
The major reason for the dormancy or halt in the operations of Nigeria’s oil rigs was the alarming rate of crude oil theft.
The Federal Government, oil unions, military, among other stakeholders, have repeatedly expressed concerns about this.
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), for instance, recently stated that some oil companies had to shut-in some of their oil wells following the persistent theft of crude.