By Chibisi Ohakah, Abuja
Analysts say Nigeria, Angola and Libya face difficulties ramping up production, even as oil prices came down below $80 a barrel on Wednesday after the Organisation of Petroleum Exporting Countries (OPEC)+ producers stuck to an agreed output target rise for February and investors assessed the impact of a spike in COVID-19 cases caused by the Omicron variant.
Brent crude futures were down 18 cents, or 0.23 per cent to $79.82 a barrel while U.S. West Texas Intermediate (WTI) crude futures declined 23 cents, or 0.3% to $76.76. last Tuesday, OPEC+ producers, which include members of the OPEC along with Russia and others, agreed to add another 400,000 barrels per day of supply in February, as they have done each month since August.
It was reported that the US turned in nearly 1 million new coronavirus infections on Monday, the highest daily tally of any country in the world and nearly double the previous U.S. peak set a week earlier. While OPEC+ raised its output target, it will likely struggle to reach it, as members including
“OPEC+ has adopted the path of least (political) resistance, as it continues to stay the course on increasing output targets, but actual incremental supplies are likely to be much smaller, similar to the demand effect from Omicron,” the analysts stated.
The bank expects Brent oil prices to average $80 a barrel in 2022. Data showing a sharp rise in U.S. inventories last week also weighed on prices.
U.S. gasoline stockpiles rose by 7.1 million barrels in the week to December 31, the American Petroleum Institute (API) reported late on Tuesday. Distillate stockpiles climbed by 4.4 million barrels in the week.