April 16, 2024

Nigeria’s Petroleum Minister justifies OPEC+ decision on production cut


Oredola Adeola

Timipre Sylva, Minister of State for Petroleum Resources, has justified the decision of the Organisation of Petroleum Exporting Countries (OPEC)  and its allies to cut two million barrels of crude oil production, insisting that it was a unanimous one.

Sylva said this in a statement on Tuesday entitled “On OPEC+ Decision to Cut Crude Oil Production.”

EnergyDay reported that Organization of the Petroleum Exporting Countries (OPEC) and its allies had in a statement made following the 33rd OPEC and non-OPEC ministerial meeting on 5 October, reduced crude oil production by 2 million barrels per day, i.e 2 percent of current global oil supply, starting from November 2022, in response to rising interest rates in the West and a weaker global economy.

The oil cartel had claimed that the supply adjustment was being made in light of the uncertainty that surrounds the global economy and oil market outlooks, and the need to enhance the long-term guidance for the oil market.

Justifying the decision of OPEC +, Nigeria’s Minister of State Petroleum Resources said that the step was taken to stabilise the market and not for any ulterior motives.

Sylva said the decision which was taken by OPEC+ during its ministerial meeting on Oct. 5, to voluntarily adjust crude oil production downward by two million barrels per day was unanimous.

He said it was taken for the exclusive purpose of ensuring the long-term stability of the oil market.

“It was purely to balance supply and demand and forestall degeneration of the current volatile oil market to a situation where larger production cuts will be required to balance it.

“This proactive decision was based on a thorough assessment of market conditions as OPEC plus has always been guided,” he said

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