Militants are controlling OPEC’s oil production
Oil watchers have been waiting for a production cut for almost two years. But while OPEC hasn’t yet participated in a coordinated effort, the cartel of oil-producing countries technically has slashed its output.
Or, more accurately, Nigeria, one of its 13 members, has.
“Actually, we did have a de facto OPEC cut. Just — it was by accident,” Helima Croft, the head of commodity strategy at RBC Capital Markets, told Business Insider in an interview on Tuesday.
“Nigeria is that big supply-disruption story — and it can just go on,” she said.
Nigerian oil production has fallen by 31% this year to about 1.4 million barrels a day, down from 2.03 million barrels a day in January. That’s such a huge drop that Angola is now the No. 1 producer in Africa, as its production held steady in April at 1.8 million barrels a day.
Attacks on energy infrastructure by a new militant group called the Niger Delta Avengers have been the main cause of the production outages. Most notably, the group attacked a Chevron offshore facility earlier this month and the underwater Forcados export pipeline operated by Shell in late March.
Croft has since argued that even if Canada comes back from its devastating wildfires, Nigeria has essentially caused a rebalancing in the oil market all by itself
