* Promises to consolidate on progress achieved
By Teddy Nwanunobi
The Organisation of the Petroleum Exporting Countries (OPEC) has declared that it owes Nigeria so much for the pivotal role it played in the ‘Declaration of Cooperation’ (DoC) process.
Speaking at the opening ceremony of the Nigeria International Petroleum Summit (NIPS) on Monday, OPEC Secretary General, Mohammad Sanusi Barkindo, conceded that OPEC, for the first time ever, “coordinated with 10 non-OPEC oil producing countries”.
This, Barkindo said, accelerated the stability of the global oil market.
Barkindo praised President Muhammadu Buhari for showing “impeccable credentials” in respect for all nations, fulfilling responsibilities, transparency and fairness.
“Many giants of Nigerian public service have been responsible for the successful membership and are addressing this Summit today.
“It is an honour to share this platform with His Excellency, President Muhammadu Buhari.
“Mr. President, the OPEC family knows the debt of gratitude we owe you for the pivotal role you played in the‘Declaration of Cooperation’ (DoC) process. The DoC constitutes an unprecedented milestone in the history of OPEC. For the first time ever, OPEC coordinated with 10 non-OPEC oil producing countries, led by the Russian Federation, in a concerted effort to accelerate the stabilisation of the global oil market.
“Mr. President, you have consistently shown your impeccable credentials as a bastion of the principles underpinning international relations: respect for all nations, fulfilling responsibilities, transparency and fairness,” he said in his keynote address.
He recalled how Buhari’s tenure has coincided with two externally caused recessions, and how his government was able to raise above the challenges.
“Your tenure, as President, has coincided with two externally caused recessions. When you were first elected in 2015, Nigeria was in the midst of a recession caused by plummeting oil prices. All energy dependent developing economies like ours were affected by this oil cycle downturn.
“From 2014 to 2016, world oil supply growth outpaced that of oil demand, with world oil supply growing by 5.8 mb/d (million barrels per day), while world oil demand increased by 4.3 mb/d. By July 2016, OECD commercial stock overhang reached a record high of about403 mb over the five-year average. The OPEC Reference Basket price fell by an extraordinary 80% between June 2014 and January 2016. Some crude oil benchmarks fell below $10/b!
“Investments were choked-off, with exploration and production spending falling by an enormous 25 per cent in both 2015 and 2016; a fall amounting to above $300 billion. There were significant job losses across the industry, as well as increasing financial and operational stresses for many companies. In fact, a record number of companies in our industry filed for bankruptcy.
“In terms of foregone revenues to OPEC member countries during this oil cycle, collectively about $1 trillion was lost as a consequence of the plunge in prices in 2015 and 2016. No member country of OPEC was insulated from such a contraction in oil revenues during this cycle.
“This had a severe impact on the resources available to the government to pursue its laudable development programmes.
“Similarly, the 2020-21 recession was also caused by extraneous factors far beyond Nigeria’s borders. The devastating spread of COVID-19 severely impacted global oil demand and, again, developing economies were exposed. As the world economy contracted by 3.5 per cent year-over-year in 2020, global oil demand declined by 9.5 mb/d. During the month of April 2020, oil demand dropped by a staggering 22 mb/d.
“And yet, President Buhari and his government bravely rose to both of these great challenges. Deploying exemplary managerial skills, acumen and extraordinary prudence by diverting resources to the most productive sectors of our economy, the government was able to revive growth. Nigeria speedily exited recession and returned to the path of growth.
“The government organised virus containment measures, campaigns to sensitise the population to the devastating impacts of the pandemic, and promptly provided much needed economic stimulus. This proactive response protected the economy from a more severe contraction. The government should be applauded for its quick and robust actions,” he recalled.He promised the energy industry stakeholders that it would contribute to the stability of the oil market.
Speaking at the opening ceremony of the Nigeria International Petroleum Summit (NIPS) on Monday, OPEC Secretary General, Mohammad Sanusi Barkindo, also said that OPEC was determined to build on the progress the industry has achieved so far.
“Over the last 20 months, OPEC has upgraded its ‘volatility fighting’ toolkit. Our monthly meetings and partnership with non-OPEC producing countries under the DoC have enabled us to improve both the nimbleness and comprehensiveness of our responses to oil market instability.
“Allow me to conclude by assuring Mr. President and all stakeholders in the energy industry that we are determined to build on the progress achieved thus far, and do what we can to contribute to stability in the oil market on a sustainable basis in the interest of all producers, all consumers, and the global economy,” Barkindo added.
Valuechain reports that this is the 4th edition of the annual Summit, which is a platform for Nigeria to engage with local, regional and global communities.
Covering an exhibition space size of 4,182 square metres (Sqm), the theme of the Summit is: ‘From Crisis to Opportunities: New Approaches to the Future of Hydrocarbons’.
The Summit will focus on technology, knowledge, sustainable and partnership that can enhance the inflow of foreign investments, while improving success rates of indigenous business engagements.
About 5,000 participants, including delegates, speakers, exhibitors and visitors from 45 countries are drawn to this year’s Summit.
The one week Summit, which became on June 4, to end on June 10, will feature eight special presentations, 12 plenary sessions, and six technological workshops.