• 6 minutes Corporations Are Buying More Renewables Than Ever
  • 17 minutes WTI @ 67.50, charts show $62.50 next
  • 23 minutes Starvation, horror in Venezuela
  • 22 hours Permian already crested the productivity bell curve - downward now to Tier 2 geological locations
  • 1 day Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 21 hours Renewable Energy Could "Effectively Be Free" by 2030
  • 22 hours Saudi Fund Wants to Take Tesla Private?
  • 1 day Mike Shellman's musings on "Cartoon of the Week"
  • 2 days Venezuela set to raise gasoline prices to international levels.
  • 2 days The Discount Airline Model Is Coming for Europe’s Railways
  • 1 day Pakistan: "Heart" Of Terrorism and Global Threat
  • 1 day Are Trump's steel tariffs working? Seems they are!
  • 2 days Scottish Battery ‘Breakthrough’ Could Charge Electric Cars In Seconds
  • 3 hours Hey Oil Bulls - How Long Till Increasing Oil Prices and Strengthening Dollar Start Killing Demand in Developing Countries?
  • 15 hours Why hydrogen economics does not work
  • 14 hours China goes against US natural gas
Deciphering The New Caspian Agreement

Deciphering The New Caspian Agreement

The Caspian deal is a…

What Happens Next To China’s Crude Imports?

What Happens Next To China’s Crude Imports?

Crude oil flows to Chinese…

Oil Theft is Costing Nigeria $1 Billion a Month

Chief Martin OnovoChief Martin Onovo, a petroleum engineer and a 2011 candidate for the presidency of Nigeria with the Action Alliance, gave an interview with allAfrica.com in which he discussed Nigeria’s current economic and political problems, and how the $1billion of oil stolen each month is only a natural result of a corrupt, immoral government.

Of all OPEC members, Nigeria is the only country that has to import petroleum products, all others have domestic refining industries that can produce refined products to meet the country’s personal demand, with any excess crude oil then exported.

Onovo explains that fuel is critical to producing energy, and setting the cost at which that energy is sold. By importing the fuel, the costs automatically jump, impacting on the transportation and industrial sectors, as well as the general households; Nigeria is suffering the consequences in terms of “devaluation, macro-economic instability, unemployment, industrial crisis and ultimately a reduction of GDP.”

Related article: Nigeria’s Oil Industry Threatened by Petroleum Industry Bill

Nigeria currently has a refining capacity of 445,000 barrels a day, which Onovo claims is over 40 million litres a day gasoline, far more than the country’s current demand. By restoring refineries to operate at their maximum capacity Nigeria could reduce its needs for imports, and by adding to refining capacity it could even begin to export high value refined products at a far higher margin than crude oil.

The problem is, Onovo claims, that Nigeria lacks the political leadership to set a clear direction and lead the country out of the dark. At the moment Nigeria unnecessarily wastes potential revenues by not utilizing its domestic refineries efficiently, and then accepts unnecessary costs by paying for “transportation, marketing and overhead cost, insurance, port taxes, brokerage charges exporting crude,”and then paying for “all that again bringing in refined product.”

Onovo also blames Goodluck Jonathan’s government for the failing national security, which has led to unrest, violence, and a boom in oil theft. The Federal Ministry of Finance states that the theft of crude oil is costing Nigeria 350,000 barrels a day, which at $100 a barrel equates to $1 billion a month in lost revenues. Onovo said that “crude oil theft is a reflection of the collapse of national security.”

By. Charles Kennedy of Oilprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News