The World Bank has said that political stress in Nigeria and other countries may affect the global supply of crude oil.
Although the World Bank forecast a rise in the price of crude oil from $53 a barrel in 2017 to $56 per barrel in 2018, the bank noted that there are substantial risks to the forecast.
According to the bank in its October edition of Commodity Markets Outlook released last week, in Washington, “Supply to the global market from politically-stressed oil producers, including Iraq, Libya, Nigeria, and the República Bolivariana de Venezuela could be volatile.”
It added that “Agreement among OPEC and non-OPEC countries to cut production more deeply could materially tighten markets. Conversely, failure to extend the agreement could exert downward pressure on prices.”
The World Bank premised its oil price rise forecast on “steadily growing demand, agreed production cuts among oil exporters and stabilizing U.S. shale oil production.”
It added that “prices for energy commodities – which include oil, natural gas, and coal — are forecast to climb 4 percent in 2018 after a 28 per cent leap this year.”
Crude oil production in Nigeria has risen from about 800,000 barrels daily in 2015 to about 2.2million barrels per day now sequel to the ceasefire agreement between the Federal Government and militant groups in the Niger Delta region.
Niger Delta militants had embarked on consistent attacks on oil installations shortly after the 2015 presidential election, a development that had disrupted the nation’s oil production with a telling effect on revenue accruing to the country.
To seal the peace deal, the Federal Government entered into an agreement with the Pan Niger Delta Elders Forum (PANDEF), led by Chief Edwin Clark, to, among other things, continue with the amnesty programme and give pipeline surveillance contracts to Niger Delta youths.
However, the peace enjoyed in that region appears threatened because of the disagreement among some groups in the region.
In a statement issued on Thursday, a coalition of militant groups from the nine states of the Niger Delta, led by the Reformed Niger Delta Agenda (RNDA), warned that it would be forced to resume hostilities against oil installations if the Federal Government entered into any discussion or agreement with PANDEF.
The coalition, in a communiqué issued at the end of its meeting on Thursday, called on the government to negotiate only with the Pan Niger Delta People’s Congress, headed by Pere Charles and Dr. Ayemi Botu.
According to the coalition, “They have our mandate from the creeks, to discuss and negotiate with the Federal Government, on behalf of the region.
“RNDA, with the coalition of other militant groups in the region wish to call on President Muhammadu Buhari not to have anything to do with the disbanded PANDEF group as they cannot speak or negotiate with the Federal Government on behalf of the Niger Delta region.
“The coalition will be forced to resume hostilities in the creek in a well-coordinated approach, if the Federal Government enters into any discussion with PANDEF, as the group no longer enjoys the blessings and support of militants stakeholders in the region.”
Iraq, Libya and the República Bolivariana de Venezuela are all also embroiled in internal political crises that could disrupt their oil production and impact negatively on supply to the global market.
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