The Organization of Petroleum Exporting Countries, OPEC, has capped production output of some of it’s oil producing states, in furtherance to efforts to stem supply glut.
The cartel has informed Nigeria to produce nothing above 1.8 million barrels of crude oil per day (1.8mbpd). Nigeria presently produces about 1.75mbpd of crude oil, while Libya does 980,000mbpd.
Libya was also informed not to produce oil above one million barrel per day.
This decision was reached last week Thursday at the meeting of OPEC and non-OPEC members held in Vienna, Austria.
Both African nations were allowed to extend their oil-production cuts to the end of 2018, but would be subject to a review at the next scheduled meeting in June.
Nigeria, in its 2018 budget, had pegged the oil production at 2.3mbpd, but with this latest development, it might have to adjust this benchmark.
Minister of State for Petroleum, Mr Ibe Kachikwu, who led Nigeria’s delegation to the meeting, disclosed that efforts would not be put in producing condensate and others not captured along pure crude by OPEC calculations.
This oil cap is aimed at stabilising the price of the commodity at the global market.