The Minister of State for Petroleum Resources, Chief Timipre Sylva, says the Federal Government is deepening effort to spur oil production in to take advantage of global crude oil price.
Sylva said this in Abuja while briefing newsmen on the forthcoming Nigeria International Energy Summit (NIES 2022) slated from Feb. 27 to March 3.
He was reacting to the global oil benchmark Brent crude which rose over five per cent to trade at $103.33 a barrel with escalating tensions between Russia and Ukraine.
Newsmen reports that Oil prices jumped on concerns of global supply disruptions from the impact of trade sanctions on major crude and fuel exporter Russia after it invaded Ukraine.
Reacting to the rising prices of crude, including Brent, which rose to $103.33 from $96 per barrel in the global market, the minister said Nigeria’s production was not optimal hence it was encouraging increased production.
He said that already Nigeria’s oil production was not where it was few months ago, adding that it needed to climb up gradually and before the end of 2022, Nigeria would have completely regain its production.
According to him, our oil production at this point is not very optimal; we will rather like to have a production that can take advantage of the high price through high input.
“A lot is going on, we are not happy that we are not able to take advantage of high prices, it is our loss, and we are doing everything to ensure that we increase our production.
“In the industry, the price of oil was being determined by a lot of fundamental issues.
“When oil prices go high it means that there are other competing production that will also come up, for example the shale oil producers in U. S. will now find it profitable whereas if it is at a certain level, it will not be profitable for them to produce.
“Once oil prices go up to a certain point, you are encouraging other production that otherwise will not be in the market.
“We are not happy when oil prices go to a certain level rather it should be at a point which will be optimal for us,” he said.
Describing Nigeria as a net importer of Petroleum, he said when crude oil prices rose globally it could also affect the price of petroleum products which would not be good for the country.
“It is not as if we are happy with the prices because we are taking from one side and giving away from another side, at the end we are not gaining we are taking from the high prices and also importing high petroleum products.
“We are encouraging more producers to neutralise the market for us,” he noted.