President Muhammadu Buhari jets
out to Saudi Arabia and Qatar today to
engage officials of both countries in further
talks to ensure stability of oil prices. Nigeria,
yesterday, agreed to freeze the country’s
crude oil production at 2.2 million barrels per
day this month, same as the level recorded in
January, in a bid to address the declining
price of crude oil in the international market.
The government’s move is a reaction to Saudi
Arabia and Russia which have agreed to
freeze oil output at near-record levels, the
first coordinated move by the world’s two
largest producers to counter a slump that has
pummelled economies, markets and
companies.
Speaking after a meeting with Qatar’s Energy
Minister, Mohammed Al Sada and Qatar
Petroleum Chief Executive Officer Saad
Sharida Al Kaabi in Doha, Minister of State for
Petroleum Resources, Mr. Ibe Kachikwu, said
the decision was in support of the decision of
Saudi Arabia and Russia to freeze oil
production.
He, however, disclosed that Nigeria was
looking for ways to increase crude oil
production, not for the purpose of export but
for local consumption.
"Nigeria will continue to look at the possibility
of increasing production, not to sell it,
because we have local consumption that is
essential for us.
“Right now, we are not even exporting the
quantity that OPEC has given us. Demand
from domestic refineries is at least 500,000
barrels of oil a day,” he explained.
Kachikwu also gave far-reaching
recommendations on how Iran and Iraq could
regain some of their lost market share due to
sanctions and war.
He said: “Countries like Iran and Iraq have
been out of the market for a while and if they
are to come back you should not freeze them
out where they are, you should freeze them at
a higher level. By June, we will come very
close to tightening the market.”
Kachikwu stated further that there was little
chance that the Organization of Petroleum
Exporting Countries, OPEC, will hold an
emergency meeting before the next regular
one scheduled for June.
According to him, "rather than focus on
emergency meeting, we need to talk more
because if you held a meeting when you have
not agreed largely on the solution, it would
not be productive and would also affect the
price of oil.”
Buhari jets out
Meanwhile, President Muhammadu Buhari is
billed to leave Abuja for Suadi Arabia and
Qatar today to engage officials of both
countries in talks for the stability of oil prices.
The President, who would be away for a
week, will be accompanied on the journey by
a high-powered Federal Government
delegation, including the Minister of State
(Petroleum) and Group Managing Director of
the Nigerian National Petroleum Corporation,
(NNPC), Dr. Ibe Kachikwu.
On Tuesday, President Buhari would fly to
Riyadh, Saudi Arabia’s capital, to hold talks
with King Salman Bin Abdulaziz Al Saud and
senior officials of the Kingdom of Saudi
Arabia.
A statement by the presidential spokesman,
Mr. Femi Adesina, yesterday, stated:
“Ongoing efforts by Nigeria and other
members of the Organisation of Petroleum
Exporting Countries, OPEC, to achieve greater
stability in the price of crude oil exports are
expected to be high on the agenda of
discussions between President Buhari and the
Saudi monarch.
“Crude oil prices and market stability will also
be on the front burner when President Buhari
goes on to Doha, Qatar, on Saturday for
talks on Sunday with the Emir of Qatar,
Sheikh Tamim bin Hamad Al Thani.”
The statement said the President would also
hold meetings with heads of international
financial organisations and multilateral
associations in Saudi Arabia and visit Medina
and Mecca to pray for greater peace,
prosperity and progress in Nigeria before
going on to Doha.
Saudi Arabia, Russia to freeze oil output
Saudi Arabia and Russia have agreed to
freeze oil output at near-record levels.
While the deal is preliminary and doesn’t
include Iran, it’s the first significant
cooperation between OPEC and non-OPEC
producers in 15 years and Saudi Arabia said
it’s open to further action. Oil pared gains
after the accord was announced, signalling
traders see no immediate end to the global
supply glut.
The deal to fix production at January levels,
which includes Qatar and Venezuela, is the
“beginning of a process” that could require
“other steps to stabilize and improve the
market,” Saudi Oil Minister Ali Al-Naimi said in
Doha.
Tuesday after the talks with Russian Energy
Minister Alexander Novak. Qatar and
Venezuela also agreed to participate, he said.
Saudi Arabia has resisted making any cuts in
output to boost prices from a 12-year low,
arguing that it would simply be losing market
share unless its rivals also agreed to reduce
supplies. Naimi’s comments may continue to
feed speculation that the world’s biggest oil
producers will take action to revive prices.
“The reason we agreed to a potential freeze
of production is simply the beginning of a
process” over the next few months.
“We don’t want significant gyrations in prices.
We don’t want a reduction in supply. We want
to meet demand. We want a stable oil price,”
Naimi told reporters.
More than a year since the Organization of
Petroleum Exporting Countries decided not to
cut production to boost prices, oil remains
about 70 percent below its 2014 peak.
Supply still exceeds demand and record
global oil stockpiles continue to swell,
potentially pushing prices below $20 a barrel
before the rout is over, Goldman Sachs Group
Inc. said last week.
While Novak has said he could consider cuts
if other countries joined in, Russia faces
significant obstacles to doing so.
Oil erased gains in London after rising before
the meeting amid speculation the countries
would discuss production cuts. Brent crude
fell 3.6 percent to settle at $32.18 a barrel
Tuesday in London, having earlier climbed as
much as 6.5 percent.

http://www.vanguardngr.com/2016/02/buhari-in-diplomatic-shuttle-to-stabilise-oil-price/