The Nigerian Minister of State for Petroleum Resources, H.E. Timipre Sylva, said that the largest producer of oil on the continent has cut its crude oil production level from over 2 million barrels a day to 1.4 million barrels in compliance with its allotted quota from the Organisation of Petroleum Exporting Countries and its allies (OPEC+).

He disclosed this after a closed-door meeting that lasted for almost an hour with the Minister of Petroleum and the President of Nigeria, Muhammadu Buhari, at the Presidential Villa, Abuja, while answering questions from the reporters at the State House.

He answered the question of a journalist who asked the Minister to comment on the latest hike in the price of the Premium Motor Spirit (PMS) otherwise known as “petrol.” He said the power to fix pump price no longer lies within the hands of the government as the product supply had been deregulated.

He said that the earnings of the government had reduced by about 60% due to the COVID-19 pandemic. He, however, attributed the recent hike in the global crude price to the announcement of a vaccine for coronavirus by Pfizer.

In his words, “These are not the best of times not only for Nigeria but for the global community. Why do we have to do this? It is clearly impossible for the government to continue to subsidise. The money is not there now. Just take the example of our production levels, our crude oil production level was over 2 million barrels a day, today, to comply with OPEC cut and quota, we have reduced production to 1.4 million barrels. Having reduced production to 1.4 million barrels, crude oil is also not selling at an optimal rate. Where do you get the money to continue to subsidize?”

“If the price of crude oil goes up, then it means the price of the feedstock has gone higher. It will also affect the price of the refined product and that is why you see that product prices are usually not static. It depends on the price of crude oil, which goes up and down.”