Keynoting at a September 4th Public Lecture chaired by former Presidential Adviser on Petroleum Matters & Chairman Emerald Energy Institute (EEI), University of Port Harcourt, Nigeria, Dr. Emmanuel Egbogah, EEI visiting Professor and Fellow, Paul Michael Wihbey predicted the return of large volumes of Nigerian crude to the lucrative US market. Speaking to an audience of prominent oil and gas experts, faculty members, and graduate students at the University of Port Harcourt, Mr Wihbey’s forecast was carried by numerous Nigeria and international media outlets.
Less than two weeks later, his prediction seems to be turning into an unexpected and most welcome reality for the financially beleaguered country that has seen its revenue intakes from crude exports sharply diminish as a result of the year- long decline in oil prices. According to Platts, Exxon, PES, and Statoil are chartering tankers to take Nigerian crude to the US for end-September loading cargoes. Traders also report Vitol’s October 3-4 loading Qua Iboe cargo was heading to the US.
Professor Wihbey had prepared his call of this extraordinary market movement several weeks prior to his return to the Emerald Energy Institute, Uniport. His analysis was the first academic or professional statement on the likely return of Nigeria crude to the US.
Wihbey’s take on Nigeria’s export opportunity during a low oil price era has valuable economic, commercial and geopolitical implications that EEI is currently researching and evaluating on behalf of the oil and gas sector in Nigeria.
As he indicated during his presentation, market, policy, and regulatory changes in the United States have led to a narrowing of the WTI/Brent price differential favoring the importation of Nigerian light crudes. Professor Wihbey cautions however, ”while these shipping reports are positive initial indicators, Nigeria still has much to do to nurture and craft a long-term, steady, and reliable flow of crude to North America. If it does, it will instill a level of international confidence in Nigeria that has not existed for several years.”
In addition, Professor Chijioke Nwaozuzu, Deputy Director EEI opined that “boosting Nigerian Government’s revenue from crude oil exports is important in the immediate and short- term, but that in the longer-term the nation should utilize accruing crude oil revenues to diversify towards the downstream petroleum sector as well as link the petroleum industry to other critical sectors of the economy”. According to Prof Nwaozuzu, “this has become imperative due to the current climate of low crude oil prices and Goldman Sach’s predictions that crude oil prices could hit a low of about $20 per barrel in 2016”.
Emerald Energy Institute, University of Port Harcourt, is an internationally recognized graduate school with in-depth energy research, technical, and industry-related assets to accurately assess and evaluate oil market dynamics and policies on a regional, national and international level.