Three member countries of the Organisation of Petroleum Exporting Countries (OPEC) including Nigeria will enjoy an exemption in production cut as the cartel tries to steady oil prices slump in November.
OPEC last Wednesday agreed to effectively cut their oil production volumes to 32.5 million barrels per day (mbpd) from around 33.24mbpd, thus shaving off about 0.74mbpd.
News of the production cut by the oil cartel came to the oil industry as a landmark deal, one which will see output levels for each member country determined in November 2016, but will also exclude three of its members – Nigeria, Iran and Libya from participating in the output cuts due to their peculiar production challenges.
Reportedly coming for the first time in about eight years, the deal was largely successful on the back of Saudi Arabia softening its stance on its arch-rival Iran as well as on the mounting pressure from low oil prices.
While the group would reduce their output to 32.5mbpd, and determine how much each country will produce at the next formal meeting, it also hopes to extend an invitation to non-OPEC countries such as Russia, to join in the output cuts, at least to buoy its desire to see some improvements in prices.
Nigeria’s exemption from the output cut is due to disruptions of production from her oil fields by militants in the Niger Delta region.
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