Global benchmark Brent earlier on Tuesday surpassed $80, its highest since November.
This is as Nigeria’s crude oil output is expected to increase to 1.701 million barrels per day next month from the 1.649 million barrels per day it has recorded since last November.
The increase was sequel to Tuesday’s OPEC and non- OPEC ministerial meeting which reaffirmed a 400,000-barrel per day increase in the monthly overall crude oil production and export for member countries.
The meeting reaffirmed the decision of the 10th OPEC and non-OPEC ministerial meeting on April 12, 2020 and further endorsed in subsequent meetings including the 19th OPEC and non-OPEC ministerial meeting on the July 18, 2021.
It re-confirmed the production adjustment plan and the monthly production adjustment mechanism approved at the 19th OPEC and non-OPEC ministerial meeting and the decision to adjust upward the monthly overall production by 0.4mb/d for the month of February 2022.
The meeting reiterated the critical importance of adhering to full conformity and to the compensation mechanism taking advantage of the extension of the compensation period until the end of June 2022.
“Compensation plans should be submitted in accordance with the statement of the 15th OPEC and non-OPEC ministerial meeting. It decided to hold the 25th OPEC and non- OPEC ministerial meeting on February 2, 2022”.
The club’s members approved a previous hike at their December meeting despite the emergence of Omicron, which had caused prices to fall as markets fretted over its potential impact on the global economy.
The December decision earned the thanks of the White House, nervous of the effect of rising prices at American petrol stations, but it did not prevent crude prices from recovering considerably from their previous slump.
Besides, the price of Brent, Europe’s benchmark oil contract, hit $79.76 at 1325 GMT on Tuesday — 15 percent higher than before the group’s December 2 meeting.
OPEC analysts said that Omicron would have a moderate impact on demand and the rise in price is expected to continue in 2022.
While the new COVID variant is spreading like wildfire around the world, it appears to be far less severe than initially feared, raising hopes that the pandemic could be overcome and life return to a little more normality.
In remarks on Monday, OPEC Secretary General Mohammed Barkindo emphasised the need to “remain highly nimble and adaptable to the constantly changing situation”.
He said the group’s “flexible approach has helped provide an added sense of stability, reassurance and continuity to the market and investors”.
OPEC on Monday named Kuwaiti oil executive Haitham al-Ghais to succeed Barkindo on August 1.
Al-Ghais, who was Kuwait’s OPEC governor from 2017 to June 2021, is a deputy managing director of the Kuwait Petroleum Corporation (KPC).