Federal Government oil earnings have been reduced by about N1.474tn between January and October 2021 due to various concerns at terminals that prevented the production of 50.788 million barrels of oil during the 10-month period.
According to available information, community interferences, industrial actions by oil workers, COVID-19 outbreak at some terminals, pipeline vandalism, among others, curtailed oil production in various terminals, all played part in a huge financial loss for Nigeria.
This came as stakeholders pleaded with the Federal Government to push for the deployment of latest technologies in securing oil infrastructure, as well as try to get rid of issues that would request industrial actions.
Industry data obtained from various reports of the Crude Oil Marketing Division of the Nigerian National Petroleum Company (NNPC) Limited in Abuja showed that in January, February and March, the volumes of oil lost due to production shut-ins were 3,678,000; 4,105,000 and 3,142,000 respectively.
It continued in August, September and October, as crude oil production losses due to shut-ins were put at 6,680,620; 6,362,700 and 4,824,946 respectively.
An aggregate of the crude oil volumes that were shut-in between January and October 2021 indicated that the country lost about 50.788 million barrels of oil during the 10-month period.
The 2021 average monthly prices of a barrel of Brent, the crude against which Nigeria’s oil is priced, were obtained from Statistica, a global statistical firm.
Figures from the international firm indicated that the average prices of Brent in January, February, March and April 2021 were $54.77, $62.28, $65.41 and $64.81 respectively.
For the months of September and October, the average monthly prices of Brent per barrel were put at $74.49 and $83.54 respectively.
At the official exchange rate of N411.95 to the dollar, the worth of the crude volumes lost by the country in January, February, March and April were N82.98bn, N105.32bn, N84.66bn and N122.24bn respectively.
This implies that the value of the 50.788 million barrels of crude oil that was lost by Nigeria during the 10-month period was about N1.474tn, a development which, according to analysts, could have been avoided.
They noted that the huge financial loss came at a time when the country’s debts had been increasing, with the Federal Government sourcing for funds by borrowing several billions of dollars.