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Firm Advises FG to Fight Oil Theft From Its Source

Oilserv Limited, an oil and gas firm has advised the Federal Government to fight the issues of oil theft directly from its source as it is the only way to solve the pipeline vandalism disrupting the oil and gas sector.

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Oilserv Limited, an oil and gas firm has advised the Federal Government to fight the issues of oil theft directly from its source as it is the only way to solve the pipeline vandalism disrupting the oil and gas sector.

According to the Chief Executive Officer (CEO) of Oilserv Limited, Emeka Okwuosa, identifying the issues from the source would require the efforts of government officials at all levels, from the local government up to the state government, including the Nigerian National Petroleum Corporation Limited (NNPCL), International Oil Companies (IOCs) and oil producers.

The CEO further urged the Federal Government to adopt the use of high-end modern technologies and methodologies as part of the methods to solve the issues of oil theft.

Okwuosa said the United States uses Horizontal Directional Drilling, which is capable of making oil and gas pipelines invulnerable to sabotage, although acquiring such technology would require huge investments but in the long run, the sacrifice would be worth it.

Speaking in regards to adopting technology, an ex-naval officer, Rear Admiral Gbadejo Adedeji said securing an advanced technology would successfully monitor oil pipelines and reduce the incessant crude oil theft in the country.

The ex-naval officer stated it is high time the Federal Government pays adequate attention to the security situation in Nigeria, most especially the oil and gas sector as it is the nation’s wealth and should be handled effectively.

Rear Admiral Gbadejo clarified the importance of high-end technology, citing Saudi Arabia as an example, he said, the network of oil pipelines in Saudi Arabia is technologically sound and tight with a huge structure, making it hard to illegally access one drop of oil.

He requested the federal government to propel Nigeria in this direction as it is a country majorly dependent on oil and gas to service the country’s economy.

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Crude Oil

Crude Oil Dips Slightly on Friday Amid Demand Concerns

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On Friday, global crude oil prices experienced a slight dip, primarily attributed to mounting concerns surrounding demand despite signs of a tightening market.

Brent crude prices edged lower, nearing $83 per barrel, following a recent uptick of 1.6% over two consecutive sessions.

Similarly, West Texas Intermediate (WTI) crude hovered around $78 per barrel. Despite the dip, market indicators suggest a relatively robust market, with US crude inventories expanding less than anticipated in the previous week.

The oil market finds itself amidst a complex dynamic, balancing optimistic signals such as reduced OPEC+ output and heightened tensions in the Middle East against persistent worries about Chinese demand, particularly as the nation grapples with economic challenges.

This delicate equilibrium has led oil futures to mirror the oscillations of broader stock markets, underscoring the interconnectedness of global economic factors.

Analysts, including Michael Tran from RBC Capital Markets LLC, highlight the recurring theme of robust oil demand juxtaposed with concerning Chinese macroeconomic data, contributing to market volatility.

Also, recent attacks on commercial shipping in the Red Sea by Houthi militants have added a risk premium to oil futures, reflecting geopolitical uncertainties beyond immediate demand-supply dynamics.

While US crude inventories saw a slight rise, they remain below seasonal averages, indicating some resilience in the market despite prevailing uncertainties.

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Nigeria’s Oil Rig Count Soars From 11 to 30, Says NUPRC CEO

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The Chief Executive Officer of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, has announced a surge in the country’s oil rig count.

Komolafe disclosed that Nigeria’s oil rigs have escalated from 11 to 30, a substantial increase since 2011.

Attributing this surge to concerted efforts by NUPRC and other governmental stakeholders, Komolafe highlighted the importance of instilling confidence, certainty, and predictability in the oil and gas industry.

He explained the pivotal role of the recently implemented Petroleum Industry Act (PIA), which has spurred significant capital expenditure amounting to billions of dollars over the past two and a half years.

Speaking in Lagos after receiving The Sun Award, Komolafe underscored the effective discharge of NUPRC’s statutory mandate, which has contributed to the success stories witnessed in the sector.

The surge in Nigeria’s oil rig count signifies a tangible measure of vibrant activities within the upstream oil and gas sector, reflecting increased drilling activity and heightened industry dynamism.

Also, Komolafe noted that NUPRC has issued over 17 regulations aimed at enhancing certainty and predictability in industry operations, aligning with the objectives outlined in the PIA.

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Oil Prices Rebound in Asian Markets Amid Red Sea Shipping Concerns

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Amid escalating attacks on shipping in the Red Sea and growing uncertainty regarding U.S. interest rate cuts, oil prices rebounded in Asian markets today.

Brent crude oil, against which Nigerian oil is priced, climbed by 24 cents to $82.58 a barrel while the U.S. West Texas Intermediate crude oil (WTI) rose by 21 cents to $77.25.

The rebound comes after both Brent and WTI contracts experienced a 1.5% and 1.4% decline, respectively, from their near three-week highs on Tuesday.

This decline occurred as the premium for prompt U.S. crude futures to the second-month contract widened to $1.71 a barrel, its widest level in approximately four months.

However, on Wednesday, the premiums slid to 4 cents a barrel.

Analysts suggest that oil futures have entered a relatively range-bound phase, with current prices reflecting a risk premium of $6-7 per barrel.

The situation could persist until the next significant development in the Gaza crisis, whether it involves a de-escalation through a ceasefire or a further intensification of the conflict.

Recent attacks on vessels in the Red Sea and Bab al-Mandab strait by Yemen’s Iran-aligned Houthis have heightened concerns over freight flows through these critical waterways.

Moreover, Washington’s veto of a draft UN Security Council resolution on the Israel-Hamas war has added to geopolitical tensions impacting oil markets.

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