Indications emerged Friday that the European Union may turn to Nigeria and other oil-producing countries for oil supply amid moves to approve an embargo on Russian oil.
The New York Times reported Friday that the oil embargo would be phased in over a period of some months.
Quoting EU officials who spoke on condition of anonymity, the newspaper said the new resolution is expected to be approved by E.U. ambassadors next week as part of plans to avoid delays.
The EU resolution comes against the background of new assessments that the Russian military’s eastern offensive was faltering amid plans to provide Ukraine with more weapons and support.
With about one quarter of the Europe’s yearly oil needs coming from Russia, European countries rely heavily on Russia for supply. But officials said the union is looking elsewhere for oil supply.
“As the oil embargo is phased in, officials said the bloc would seek to make up the shortfall by increasing imports from other sources, like Persian Gulf countries, Nigeria, Kazakhstan and Azerbaijan,” the New York Times reported Friday, quoting officials.
Since the invasion of Ukraine earlier in thee year, the EU embargo—If enacted— will be the biggest and most important new step in the E.U.’s sixth package of sanctions against Russia.
The new sanctions will also be directed at Russia’s biggest bank, Sberbank, according to officials who spoke to the New York Times.
Nigeria, Africa’s largest oil producer, has faced challenges with oil production in recent months. The nation has had to close a number of its oil wells to keep criminals at bay, Zainab Ahmed, the country’s Finance Minister, said in a recent interview with Bloomberg TV.
Mrs Ahmed said that upon opening the wells, Nigeria will meet its quota of producing 1.6 million barrels of crude per day (mbpd).
For many months, Nigeria has produced 20 per cent less than capacity due to oil bunkering and other criminal activities.
Amid oil price rally as a result of Russia’s invasion of Ukraine, Nigeria has struggled to meet its Organization of Petroleum Exporting Countries (OPEC) quota of 1.73 mbpd.
The OPEC monthly oil market report (MOMR) for April 2022 showed that the country’s oil production fell by 20,000 barrels per day (tb/d) in March to 1.24 million bpd from 1.26 million in February 2022.
The nation also recorded a 24000 b/d decrease in oil output to 1.35 million bpd in March, down from 1.38 million bpd the previous month.
As the EU turns to Nigeria and others for supply, expectations are high that production would improve across the nation’s oil wells.
Nigeria relies heavily on crude oil sales to fix infrastructure, meet debt obligations and earn foreign exchange that would enable its monetary policy decision makers address inflation.