The Niger Delta Avengers (NDA) were a major driver of the rally in oil markets over the past several months, as the outage of roughly 600,000 barrels per day helped push up crude oil prices. In June, a 30-day ceasefire between the NDA and the Nigerian government led to a few weeks of relative calm, and Nigeria’s oil minister said that the country was able to bring back a large chunk of the disrupted supply, bringing output up from 1.4 million barrels per day to 1.9 mb/d at the end of June, but still down from the 2.2 mb/d Nigeria produced before the vicious campaign began a few months ago.
But the ceasefire may already be over. According to local news reports, the Niger Delta Avengers struck new oil wells over the weekend, hitting two oil wells controlled by the oil major Chevron. “Preliminary investigations so far from our men in the field is that dynamite was used to blow up the facilities just like in previous attacks,” a source told THISDAY. The NDA also said on Twitter that it struck two major oil pipelines owned by the Nigerian National Petroleum Corporation (NNPC). They were the first attacks since June 16.
“At 9:15p.m on Friday, the @NDAvengers blew up Nigerian National Petroleum Corporation (NNPC) Crude Oil Trunk Line to Warri Refinery,” NDA said in a tweet.
It followed up with several more tweets:
“At 11:26pm on Saturday @NDAvengers blew up two NPDC major crude trunk lines close to Batan flow station in Delta state.”
“At 1:15am on Sunday @NDAvengers blew up two major Chevron Oil Wells. WELL 7 and WELL 8 close to Abiteye flow station in Delta state.”
“All Five Operations were carried out by @NDAvengers Strike Team. Well Done Soldiers.”
Unfortunately for the group, Twitter suspended their account. But they have made their presence known, with the ceasefire feared dead. That could mean attacks continue to climb against oil companies in the Niger Delta, threatening to send Nigeria’s oil output tumbling all over again. Related: Big Oil Could Spark A Renaissance In U.S. Shale
Nigeria’s oil minister had said that the government was aiming to ratchet up output to 2.2 mb/d in July as oil pipelines saw repairs and wells were brought back online. But NDA could kill off that dream with a new round of attacks.
Goldman Sachs previously credited the NDA with a major role in the more than 80 percent rally in oil prices between February and May. Following the ceasefire, Goldman Sachs revised its analysis for oil, warning of a potential slide in oil prices if peace could be maintained in Nigeria. “A normalization in production, even over several more months, would create downside risk to our $50/bbl 2H16 price forecast as it would bring the global oil market close to balance over that time period,” Goldman concluded in a recent research note.
The investment bank may have to once again revise its projection for oil prices in the second half of the year. If the NDA is back, oil prices could rise higher than previously expected.
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By Charles Kennedy of Oilprice.com
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