Drag your attention away from the Middle East for a moment. While policymakers have been focused on Saudi Arabia’s oil market machinations, what really matters right now is happening 3,000 miles away in the Niger River delta.
The country that was, until recently, Africa’s biggest crude producer is slipping back into chaos. A wave of attacks and accidents have hit infrastructure, taking Nigeria’s output down to 20-year lows.
Oil prices are responding, rising to their highest in more than six months. Part of this is explained by the International Energy Agency lifting demand estimates this week. But taking both things together, it’s easy to doubt whether current oil surpluses are sustainable.
With no solution in sight to the problems that beset the delta’s creeks and mangrove swamps, production from onshore and shallow-water oil fields looks vulnerable. If the latest group of freedom fighters seeks to outdo its predecessors, then deepwater facilities may be at risk too. Read more