10 April 2012

Nigeria: Iran Sanction - The Cannot Fill Oil Market Gap - NNPC

The Nigerian National Petroleum Corporation (NNPC) has said that Nigeria may not be of much help to fill the gap in the global oil market created by the impending sanction on Iranian oil by the United States of America and Europe.

According to NNPC,Nigeria has seen its output rebound since a 2009 amnesty deal with militants, but the country's petroleum sector remains hampered by a number of factors. 'You know our problems' AFP quoted spokesman for Nigerian National Petroleum Corporation (NNPC), Dr. Levi Ajuonuma as saying. He added: 'Theft and a lack of new investments remain huge problems'.

Nigeria has been producing between 2.0 and 2.4 million barrels per day, and any significant boost beyond that appears out of the question for now.

"So we are not going to be able to, in the immediate, fill up such gaps," Ajuonuma said, referring to any sudden cut in output from Iran.

The United States expects to lean mainly on Saudi Arabia to boost world supply and allow Western nations to enforce sanctions aimed at reducing Iranian oil exports while still keeping prices steady.

Oil prices, already hovering at more than $100 per barrel, are a potent political issue in the United States with President Barack Obama facing re-election later this year.

Obama gave his approval last month to implement sanctions that could bar countries from doing business with the United States if they do not cut commercial ties with Iran.

The sanctions will go into effect on June 28 and are to be reassessed periodically.

The announcement by Obama was also seen as a bid to gain leverage over Iran ahead of an expected new round of nuclear talks with Tehran and the so-called six powers Britain, China, France, Germany, Russia and the United States on April 13.

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