THE Nigeria National Petroleum Corporation (NNPC) said it would continue oil production despite the fall in price.
The explanation came on the heels of the speculation that Nigeria had halted the production of the commodity which prices had fallen below its cost of production.
Since the outbreak of the Coronavirus in China last year, the crude oil prices have sustained a steady decline until the last OPEC+ meeting resulted in the marginal increase of crude prices.
With the high hope that the high price would endure, the Minister of State for Petroleum Resources, Chief Timipre Sylva, expressed optimism that the Federal Government could still earn as much as $2.8billion from the rise.
He expressed hope that the Federal Government could still sustain its budget benchmark of $30 per barrel.
The prices however plunged in the global oil communities into panic as they dip to about $11 per barrel on Monday.
In a telephone interview, the Group General Manager, Group Public Affairs Division, NNPC, Dr. Kennie Obateru, said: “Oil production is still going on as I know up to today.
Whoever gave you that information; I don’t know where they got it from. Our partners are the ones managing our assets. So, they are the ones that will recommend what they think should happen.”
Allaying fears over the declining prices of crude oil, he noted that the situation was not peculiar to Nigeria.
He described it as a global economic crisis, adding that only prayers for price rebound could rescue the entire economy.
“We have to pray for God’s intervention, otherwise, it is not good for any economy in the whole world,” Obateru said.
Meanwhile, former Vice President, Atiku Abubakar has ad-vised the Federal Government to build a strategic crude oil reserve with massive storage capacity that can hold at least a month’s worth of the country’s Organisation of Petroleum Exporting Countries (OPEC) production capacity.
Atiku, in a statement yesterday, said: “If we build such infrastructure, we will not have to sell our crude at a production loss. We will be in a position to stockpile the product in our reserve until such a time as prices improve.
“The global oil market continues to suffer from the vagaries of the corona virus pandemic, as prices continue to crash due to the sudden, massive and unexpected drop in worldwide demand for crude oil.
“The features market for commodities is a turbulent one, due to unforeseen hazards that come and go. Today, it is COVID19; tomorrow, it will be something else.
“It is time for Nigeria to protect her economy from being tossed to and fro by circumstances beyond our control. We must assert our sovereignty, by exerting more influence over the global trade in crude oil, and other features.”
Atiku observed that other countries take similar measures to protect their economy, citing North American and European countries.
Those countries, he said, have such internal controls to protect almost every sector of their economy, stressing that Nigeria cannot be left behind.
Atiku said the country must be in business in the best interest of the economy.
He described the pandemic which culminated in the dip of oil prices as an unexpected one which the nation prays against its degeneration to well closure.
The NNPC spokesman said: “You don’t plan for calamity. It is an act of God. As much as possible we want the situation to end so that we can return to normalcy. We continue to pray that things improve and it doesn’t get to the situation when we begin to close our wells.”