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Protesters Occupy Otumara Flow Station in Delta State, Demanding Engagement from SPDC

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Last night, a group of protesters from Ugborodo, Deghele, and Ugboegungun, the host communities of the Otumara Flow Station in Delta State, operated by Shell Petroleum Development Company (SPDC), gained access to the oil and gas facility, putting at risk the loss of 20,000 barrels of crude oil per day.

This development comes on the heels of the expiration of a 48-hour ultimatum issued to SPDC on Wednesday when the peaceful protest began.

The protesters allege that SPDC‘s actions are contrary to the spirit of the Petroleum Industry Act (PIA) by failing to engage with the Otumara Host Community Trust representing the three communities.

Reports indicate that the protesters entered the facility at precisely 5:00 p.m. when the ultimatum lapsed.

Mr. Alex Eyengho, a leader of the Ugborodo community, confirmed the occupation of the SPDC facility as of 6:00 p.m. yesterday, and video footage received supported his statement.

Eyengho stated, “The protesters are currently inside the Shell facility after the expiration of the 48-hour ultimatum. I urge you to report this accurately. For now, the protesters are refraining from shutting down the facility.”

However, he cautioned the Nigerian troops stationed at the facility, urging them to exercise restraint and avoid confrontations with peaceful protesters.

He said, “I dare say that security agencies should avoid any provocative actions, unless they are prepared to harm thousands of protesters and the people of Ugborodo, Deghele, and Ugboegungun, who are the host communities of the Otumara Shell facility. The 48-hour ultimatum expired at exactly 5:00 p.m. today, and the protesters gained access shortly after.”

When questioned about the possibility of shutting down operations at the facility and the attitude of the Nigerian troops on-site, Eyengho responded, “We are peacefully waiting for Shell, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and the Minister of State for Petroleum Resources and his Gas counterpart. SPDC authorities have indicated their willingness to visit Otumara tomorrow morning, accompanied by the NUPRC. This situation is beyond the capacity of the soldiers to resist, unless they wish to see casualties on the Escravos River.”

These host communities had previously established the Otumara Host Community Trust to engage with NUPRC in compliance with the community-based implementation of the PIA.

A similar dispute is pending between the Ugborodo Federated Communities in the Warri South West Local Government Area, which have formed the Ikpere Host Community Trust for PIA implementation.

SPDC and Chevron Nigeria Ltd. (CNL) have faced allegations of failing to adequately engage with their host communities.

It is worth recalling that residents of these communities had previously staged a protest at the Security House Boat of the SPDC Otumara Flow Station, where they displayed banners with various inscriptions.

During this demonstration, they issued a 48-hour ultimatum to SPDC, effective from Wednesday, August 23, following the expiry of an earlier 30-day ultimatum issued to the company.

The protest was closely monitored by SPDC security personnel, as well as Eghare-Aja of Ugborodo Federated Communities, Eghare-Daniel Uwawah, and Mr. Isaac Botosan, among others.

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Crude Oil

Oil Prices Rebound on OPEC+ Output Delay Talks and U.S. Inventory Drop

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Oil prices made a modest recovery on Thursday on the expectations that OPEC+ may delay planned production increases and the drop in U.S. crude inventories.

Brent crude oil, against which Nigerian oil is priced, rose by 66 cents, or 0.9% to $73.36 per barrel while U.S. West Texas Intermediate (WTI) crude appreciated by 64 cents or 0.9% to $69.84 per barrel.

The rebound in oil prices was a result of the American Petroleum Institute (API) report that revealed that the U.S. crude oil inventories had fallen by a surprising 7.431 million barrels last week, against analysts 1 million barrel decline projection.

The decline signals better than projected demand for the commodity in the United States of America and offers some relief for traders on global demand.

John Evans, an analyst at PVM Oil Associates, attributed the rebound in crude oil prices to the API report.

He said, “There is a pause of breath and light reprieve for oil prices.”

Also, discussions within the Organization of the Petroleum Exporting Countries (OPEC) and its allies, collectively known as OPEC+, are fueling speculation about a potential delay in planned output increases.

The group was initially expected to increase production by 180,000 a day in October 2024.

However, concerns over softening demand in China and potential developments in Libya’s oil production have prompted the group to reconsider its strategy.

Despite the recent rebound, analysts caution that lingering uncertainties around global oil demand may continue to weigh on prices in the near term.

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Again NNPC Raises Petrol Price to N897/litre

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The Nigerian National Petroleum Company (NNPC) Limited has once again increased the price of Premium Motor Spirit (PMS) from N855 per litre on Tuesday to N897 on Wednesday.

The increase was after Aliko Dangote, the Chairman of Dangote Refinery, announced the commencement of petrol production at its refinery.

The continuous increase in pump prices has raised concerns among Nigerians despite the initial excitement from the refinery announcement.

According to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the 650,000 barrels per day refinery will supply 25 million litres of petrol to the Nigerian market daily this September.

This, NMDPRA said will increase to 30 million litres per day in October.

However, the promise of increased fuel supply has not yet eased the situation on the ground.

Tunde Ayeni, a commercial bus driver at an NNPC station in Ikoyi, said “I have been in the queue since 6 a.m. waiting for them to start selling, but we just realised that the pump price has been changed to N897. This is terrible, and yet they still haven’t started selling the product.”

The price hike comes as NNPC continues to struggle with sustaining regular fuel supply.

On Sunday, the company warned that its ability to maintain steady distribution across the country was under threat due to financial strain.

NNPC cited rising supply costs as the cause of its difficulties in keeping up with demand.

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Brent and WTI Steady After Recent Losses as Libyan Oil Halt Continues

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Oil prices stabilised on Monday as Libyan oil exports remained halted and following losses at the end of last week on expectations of higher OPEC+ production from October and signs of sluggish Chinese and U.S. demand.

Brent crude oil, against which Nigerian oil is priced, dipped by 6 cents, or 0.08% to close at $76.87 a barrel , while U.S. West Texas Intermediate crude edged up 8 cents, or 0.11% to $73.63.

Monday marked a public holiday in the U.S. market.

On Friday Brent and WTI lost 1.4% and 3.1%, respectively.

Oil exports at major Libyan ports were halted on Monday and production curtailed across the country, six engineers told Reuters, continuing a standoff between rival political factions over control of the central bank and oil revenue.

Libya’s Arabian Gulf Oil Company resumed output of around 120,000 barrels per day (bpd) on Sunday, to feed a power plant at the port of Hariga.

“The current disturbances in Libya’s oil production could provide room for added supply from OPEC+. But these fluctuations have become quite normal over the last few years, meaning any outages will probably be shortlived; with the news flow indicating signals for a restart of production have already been given,” said Bjarne Schieldrop, chief commodity analyst at SEB.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, together known as OPEC+, is set to proceed with planned increases to oil output from October, six sources from the producer group told Reuters.

Eight OPEC+ members are scheduled to boost output by 180,000 barrels per day (bpd) in October as part of a plan to begin unwinding their most recent supply cuts of 2.2 million bpd while keeping other cuts in place until the end of 2025.

Both Brent and WTI have posted losses for two consecutive months as U.S. and Chinese demand concerns have outweighed recent disruptions in Libya and supply risk related to conflict in the Middle East.

More pessimism about Chinese demand growth surfaced after an official survey showed on Saturday that manufacturing activity sank to a six-month low in August as factory gate prices tumbled and owners struggled for orders.

“The softer-than-expected China PMI released over the weekend heightens concerns that the Chinese economy will miss growth targets,” IG market analyst Tony Sycamore said.

In the U.S., oil consumption in June dropped to seasonal lows last registered during the COVID-19 pandemic in 2020, Energy Information Administration data showed on Friday.

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