Friday, 10 May 2013

OPTS: PIB Could Deter $109 Billion of Investment

Oil Producers' Trade Section of the Lagos Chamber of Commerce has said that the Petroleum Industry Bill could cost Nigeria over $109 billion of investment if passed in its present state.
According to a presentation by the industry body, the unfavorable fiscal terms would result in Nigeria's oil production hitting a plateau of about 3 million barrels a day around 2016, and then start to decline as $109 billion in planned new investment would no longer be economically feasible.
Nigeria has long planned a thorough overhaul of its oil industry, encompassing everything from tax rates to environmental laws to the structure of the country's state-owned oil company, but the bill has stoked controversy and drawn strong criticism from the oil sector.
Uncertainty over the bill's passage has already taken its toll on the industry.
Last year, Nigeria's Department of Petroleum Resources said the country's recorded reserves had fallen to 36.5 billion barrels from 37 billion barrels in 2010 as a result of a slowdown in investment linked to uncertainty over the bill

Oil drops below $95 a barrel as dollar rises

The price of oil dropped below $95 a barrel as a strengthening dollar made crude more expensive for traders using other currencies.
In Europe, benchmark crude for June delivery was down $1.74 to $94.65 a barrel in electronic trading on the New York Mercantile Exchange.
Since oil is traded in dollars, a stronger dollar makes crude and other commodities less appealing to investors with other currencies.
Recent signs of improvement in U.S. employment data have sparked speculation that the Federal Reserve might scale back its aggressive monetary policy.

OPEC sees higher oil demand in second-half 2013

The Organization of the Petroleum Exporting Countries in a monthly report forecast 2013 demand for its crude will average 29.84 million barrels per day (bpd), up 90,000 bpd from the previous estimate. The 12-member group's own production rose by 280,000 bpd in April to 30.46 million bpd, according to secondary sources cited by the report, led by higher output in Saudi Arabia and Iraq. OPEC left its forecast for growth in world demand in 2013 unchanged at 800,000 bpd and warned of downside risks to the forecast.