OPEC stands for Organisation of the Petroleum Exporting Countries.
For Nigeria, it is a war they must win, or else we risk seeing civil unrest next year because the shege we are currently witnessing will be multiplied by next year.
What is at stake is Nigeria’s oil production capacity.
Let me explain.
Before COVID, Nigeria was comfortably producing 2:2 million barrels every day.
That was why the exchange rate was very stable and life was easier in that era.
I remember buying my first car during that period, and I bought it for less than 4 million at the exchange rate of 360. Today, the value of the same car is 12 million.
Nothing happened—just that the exchange rate is not the same again.
Then COVID happened.
OPEC came with pressure and a quota of 1.4 million barrels.
Nigeria was forced to shut down so many oil wells.
It is good to comply with OPEC so as to be a good boy, but we are talking about old oil wells where we have been drilling oil since 1970.
Those oil wells refused to restart today because they are old.
Complying with the OPEC quota in 2020 was a foolish decision, as it plunged Nigeria into an unimaginable hardship that we have yet to recover from today.
Our oil quota was later ramped up to 1.8 million barrels by OPEC, but as I said
The oil wells were old, and so they refused to restart.
We also saw an increase in oil theft in the Niger Delta on a scale we had not seen before.
And then a lack of investment in the oil and gas sectors because of climate change and a lack of regulatory clarity for investors also contributed to our woes.
So because of these factors, we have been struggling to go back to meeting our OPEC quota of 1.8 million barrels per day.
Going back to where we were before COVID became a tall dream and a mission impossible.
The result is that the exchange rate spiked to 1,200 to one dollar simply because the dollar stopped flowing because of a lack of oil production.
History has shown that the solution to our problem and the hardship that Nigerians are going through has always been a high oil price.
In the 90’s, our parents saw Shege Pro Max because of SAP, which coincidentally is what their kids are seeing today: high oil prices, occasioned by the Iraq/Kuwait war, bailed our parents at that time.
The same thing happened in the 1970s. And even recently, in 2017.
So high oil prices have always come to our rescue, but why this present hardship is different, even though oil prices have been high, is because oil production has been down.
It was that bad that we did 900,000 per day at a point this year, up from 2.2 million in 2019.
Nigerians are suffering because of the high exchange rate.
They are pushed to the brink, and this government knew that if things got worse than this, we would have civil unrest in no distant time.
NNPC has been ramping up production, and their target is to do 1.9 million barrels next month and then 2 million barrels in the first quarter of next year.
The idea behind the ramping up of daily oil production is to take advantage of the high oil price so as to guarantee the inflow of dollars into the country, which will influence the high exchange rate to come down.
The cartel at OPEC hates to hear that, and they have been pressing Nigeria to accept the last quota they gave us, which is 1.8 million barrels, but the guys at the Ministry of Oil and Gas are standing up to them this time around, man to man, face to face, eye ball to eye ball unlike 2020.
Nigeria is in a dire strait; our people are suffering.
The oil price is at $80, but our country is not befitting because of low production.
The exchange rate is above 1k to one dollar; we need dollars or else our country will implode.
Most important, we can’t do daily oil production of 1.8 million barrels as you people want from us.
The fighting was so intense last week that OPEC had to hurriedly postpone their meeting so as to use diplomacy and back door negotiations, which is to force Nigeria and Angola to accept what is not in their best interests.
Chika Mbonu,one of my favourite Arise TV economists, once advised this government to think of how to exit OPEC if we were to come out of this hole.
Because the OPEC cartel will not allow us to pump the natural resources that God gave us to a scale that we need to benefit from this oil price in the international market, and he is right.
If I were to advise this government on energy policy, exiting OPEC should be a priority and an urgent national security concern.
This is about our country.
About the survival of our citizens
Either OPEC allows us to pump 2 million barrels of crude oil daily starting next year or we exit
It is that simple and non-negotiable.
OPEC is due to reconvene again on November 30.
I hope that, for the sake of our people who have endured enough, NNPC and the energy policy guys at the Ministry of Oil and Gas do not fold to OPEC’s relentless pressure.
Nigerians have suffered enough.
We need ease.
And the OPEC of this world should either allow us to pump or we leave them. to eat their OPEC.
It is that simple!