Iraq has agreed to join Nigeria, Saudi Arabia and others to freeze crude production, which in turn would likely increase crude price at the International market. This may impact positively on Nigeria’s fortunes amidst the downturn of its economy, following incessant attacks on facilities which has dropped production drastically to a lower level.
The result of this impact also affected the sponsoring of the country’s budget and other pending projects currently suffering setback due to lack of funds.
Meanwhile, oil futures rose, supported by production suspensions in the US Gulf, due to an expected tropical storm and speculation that producers meeting in Algeria next month will act to prop up prices. Brent crude futures were trading at $49.73 per barrel at 0924 GMT, up 47 cents from the previous close. US West Texas Intermediate (WTI) crude was up 45 cents at $47.43 a barrel.
Oil prices have also been taking direction from speculation that a meeting next month in Algeria of major producers including members of the Organization of the Petroleum Exporting Countries could yield a deal on production levels to support prices.
Moreover, Shell’s Chief, Energy Adviser, Wim Thomas, has said that the huge global oil oversupply that has weighed on prices for the past two years may not clear until the second half of 2017.