…oil export dips by 2.4% in fourth quarter

Nigeria crude and oil gas sales rose sharply to N1.22 trillion in 2017, according to data obtained from the Central Bank of Nigeria, CBN.

The CBN, in its Economic Report for the Fourth Quarter of 2017, disclosed that the amount earned by the Federation from crude oil and gas sales in 2017, appreciated by 213.6 per cent or N831 billion as against N389.55 billion recorded in 2016.

Giving a breakdown of the country’s oil and gas sales in 2017, the report noted that in the first and second quarters of the year, crude oil and gas revenue stood at N78.63 billion and N101.33 billion respectively; while it rose sharply to N771.18 billion in the third quarter, before dropping to close the fourth quarter at N236.69 billion.

According to the report, total crude oil and gas sales in 2017 accounted for 29.7 per cent of gross oil revenue in the year under review.

Particularly, the report disclosed that the country recorded gross oil revenue of N4.11 trillion in 2017, appreciating by 52.5 per cent or N1.42 trillion, from N2.7 trillion recorded in 2016.

“Gross oil receipt at N1.226 trillion or 60.1 per cent of the total revenue, was lower than both the proportionate quarterly budget estimate and the receipts in the preceeding quarter by 9.1 per cent and 3.5 per cent, respectively.

“ The decline in oil revenue relative to the proportionate quarterly budget estimate was attributed to the fall in receipts from crude oil/gas exports. This was due to the drop in crude oil production, arising from leakages and shut-ins/shut-downs,” the report explained.

In addition, the report stated that Nigeria’s crude oil production, including condensates and natural gas liquids, closed in the fourth quarter of 2017 at an average of 1.80 million barrels per day (MBD) or 165.60 million barrels in the three-month period, representing a decline of 0.03 mbd or 1.8 per cent, compared with 1.83 mbd or 168.36 million barrels recorded in the third quarter.

The CBN blamed the decline in Nigeria’s crude oil output on shut-ins/shut-down in some of the production facilities across the oil-producing areas of the country.

The report also added that Nigeria’s crude oil export for the fourth quarter of 2017 dipped by 2.4 per cent, from 126.96 million barrels or an average of 1.38 million barrels per day in the third quarter of 2017 to 124.20 million barrels or 1.35 million barrels per day.

It said, “The development was due, mainly, to continued commitment by OPEC and Non-OPEC countries to avoid flooding the global market, despite the exemption of Nigeria from the production cap agreement.”

The report also noted that allocation of crude oil for domestic consumption was maintained at 0.45 million barrels per day or 41.40 million barrels in the entire fourth quarter.

The CBN also noted that, “The average spot price of Nigeria’s reference crude oil, the Bonny Light (37° API) rose from $52.92 per barrel in the third quarter of 2017 to $62.48 per barrel in the review quarter. This represented an increase of 18.1 per cent.

“The increase was attributed to the production-cut agreement, demand growth from China and increased refining activity in the United States. The UK Brent, at $61.69 per barrel, the WTI at $55.47, and the Forcados at $62.60 per barrel exhibited similar trends as the Bonny Light.”

Consequently, the report disclosed that a net sum of N1.326 trillion was retained in the Federation account after statutory deductions and transfers, adding that of this amount, the Federal Government received N637.73 billion, State and Local governments received N323.47 billion and N249.38 billion, respectively, while the balance of N115.58 billion was allocated to the 13 per cent Derivation Fund for distribution among the oil-producing states.

It also noted that the Federal, State and Local Governments received N36.50 billion, N121.66 billion and N85.16 billion, respectively, from the Value Added Tax, VAT, Pool Account.

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