Rising oil prices comes with other high cost – Sylva

The Minister of Petroleum Resources, Chief Timipre Sylva has said that the federal government is not happy with the high cost of crude oil in the international market as it comes with other high costs for the country.

Sylva told journalists in Abuja that the government was working to improve Nigeria’s low oil production level.

The Minister who was speaking ahead of the 2022 Nigeria International Energy Summit (N.I.E.S), explained that high oil prices would also attract shale producers in the United States.

He said:  “Once oil prices go up to a certain point, you’re encouraging a lot of products that will otherwise not be in the market. So we are not happy when prices go to a certain level. We believe that prices should be at a certain point, which will be optimal for us to make sub-optimal for the shale producers.

“That’s why we like to have that balance right here in Nigeria as well. You know that we are right now a net importer of petroleum products. And when the price of crude is up it also affects the price of petroleum products.

“So for us as a net importer, it’s not very good for us. But of course, in a way what we are saying is if we are going to produce more and you get more dollars from your production they give you more money for your inputs.

Read Also: Oyo government seals off Premier Hotel, 80 shops for breaking sanitation laws

“But if you are now producing less and then you still have to make sure that the Nigerian market is supplied fully then you see there is a shortfall. That’s why we would rather like to have production now to the point where we’ll at least get in enough to be able to do the imports better production at this point is not very optimal”, he added.

He said Nigeria would like to raise its production to a level that “can take advantage of the high prices not to think that we are very happy with the prices being where they are because you are taking from the side and giving it away from the other side.

“So at the end of the day, we are not necessarily making a lot of gains because we are taking from the high prices. We’re also importing higher priced products. And on the other side, we’re also encouraging producers who should not be producing to produce which of course neutralizes the market for us”.

On the 2022 NEIS which is opening in Abuja on Monday, he said about 5,000 participants are expected, adding that “the objective of the summit from inception is to deliver the biggest and best African Petroleum Technology and Business Conference that will be the definitive platform, not just for Nigeria, but also for Africa to engage the global energy community. I believe that we have delivered on that with every edition”.