Nigeria’s oil industry holds recovery prospects from 2017 – BMI

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Business Monitor International (BMI Research), a Fitch rating company said that Nigeria’s petroleum industry is still looking promising in the coming year with oil production projected to see a rebound at an average Brent benchmark of $55.00 per barrel in the international market, Vanguard reports.

The research stated that oil production will record an incremental growth for the next three years.  According to the report, “Nigeria’s oil production will come back strongly in 2017 maintaining incremental growth for the next three years. However, it also indicated that “post-2019 the outlook is one of decline, with production falling below 2.0million barrels by 2022 due to a lack of investment as multinationals favour low-cost, low-risk projects to the disadvantage of Nigeria.”

On the country’s crude trade, it noted that Traders of Nigerian crude have requested that Nigerian grades trade at a discount due to inconsistency of supply. Reacting to the data from NNPC monthly reports, which indicated that Nigeria’s refineries have continued to operate at abysmally low utilisations rates, BMI stated: “We forecast this to persist until the refineries receive the necessary investment required to improve efficiency.”

However, on gas, the report hinted that consumption has been reversed due to the actions of the Niger Delta Avengers who are succeeding in starving gas power stations of their feedstock. “Our long-term view has turned negative as private investment dries up and infrastructure remains limited,” it said.

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