07-03-06
Dr Edmund Daukoru, President of the Organisation of Petroleum Exporting
Countries (OPEC) and Minister of State for Petroleum has stressed the need for
more US investment in Nigeria's oil industry to help check insecurity in the
sector. He also noted that there was no problem with crude oil prices featuring
as high as $ 60 per barrel as long as the global economy continues to grow.
"We wanted to let the US know we're ready to take on investment in this sector
in Nigeria," Daukoru told after meeting US Energy Secretary Samuel Bodman.
Daukoru visited Washington to meet with officials of President George W.
Bush's administration.
"This is a problem that has to do with development," he said referring to the
attacks by rebels on key oil facilities in the Niger Delta. "In the area of
development, we will need further assistance from the US to protect future
energy supply," said Daukoru, who is also current president of the Organization
of Petroleum Exporting Countries.
Nigeria, which produces 2.5 mm bpd, is the fifth-leading supplier of foreign
oil to the US, accounting for about 1 mm bpd in imports. It's also West Africa's
diplomatic and political heavyweight.
For the second time this year, separatist guerrillas in the Niger Delta region
have attacked oil operations and taken hostages. Six hostages were released, but
two Americans and one Briton remained in captivity.
Daukoru said he is optimistic that the hostage-taking can be resolved soon,
adding that it will take "a couple of weeks" for production to be back in the
market.
US Department of Energy spokeswoman Anne Womack Kolton later said the
Nigerian minister was referring to the need for private sector investment in
Nigeria's oil industry. She said the meeting with Bodman happened at Daukoru's
request.
Also while crude-oil futures rose despite government data showing rising
supplies, Dr Daukoru said he sees no problem with prices above $ 60 a barrel as
long as the global economy continues to grow.
"A fair price iswhat the market can sustain," Edmund Daukoru, the Nigerian oil
minister and the president of OPEC told. However, when prices approach $ 70 a
barrel "everybody gets nervous." said Daukoru.
The OPEC president declined to speculate on whether the cartel would curtail
production at its meeting in Vienna, but said he was concerned about an
"overhang" of supply, which could lead to lower prices. In trading, light sweet
crude for April delivery on the New York Mercantile Exchange rose 56 cents to
settle at $ 61.97 a barrel.
In its weekly supply report, the Energy Department said domestic oil inventories
grew by 1.6 mm barrels to 328.3 mm barrels, or 9 % above year-ago levels.
Meanwhile, gasoline inventories rose a modest 300,000 barrels, to 225.9 mm
barrels, putting them marginally above year-ago levels.
The nation's supply of distillate fuel, which includes diesel and heating
oil, declined by 1.5 mm barrels to 134.1 mm barrels, or 14 % higher than a year
ago. The price of crude oil continues to be supported by supply fears tied to
threats such as Iran's standoff with the international community over nuclear
power development and recent militant attacks on the oil industry in Nigeria.
Attacks on the oil industry in the Niger Delta already had shut down 455,000 bpd
in crude production, nearly 20 % of the country's daily output of 2.5 mm bpd.
Daukoru said production would rise to 4 mm bpd by 2008 and to 4.5 mm bpd by 2010
a level he estimated could be sustained for at least a decade.
Source: Vanguard