The Organization of the Petroleum Exporting Countries and its allies (OPEC+) have announced a modest production increase of 137,000 barrels per day for November.
The agreement, which emerged from a brief but consequential meeting between Saudi Arabia and Russia — the two power brokers within the alliance — reflects an uneasy compromise. Riyadh, eager to defend its global market position, pushed for a more substantial hike, while Moscow preferred to hold back, wary of sending oil prices into a deeper slide.
Oil prices have been losing altitude in recent weeks, with Nigeria’s Bonny Light crude hovering around $69 per barrel and Brent trading near its lowest levels in four months. The market’s weakness is being driven by rising inventories, waning demand growth, and persistent macroeconomic uncertainty.
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Even as OPEC+ sought to portray the move as a vote of confidence in global demand, analysts see it as a cautious step designed to prevent panic selling. Yet the underlying data tells a more complicated story.
The International Energy Agency (IEA) has warned that global inventories could swell through the end of the year and reach record levels by 2026, citing cooling demand in China, slower industrial activity in Europe, and surging production from the Americas.
Nigeria’s Tightrope
For Nigeria, the decision presents a familiar dilemma — the promise of increased output weighed against the threat of lower prices. As one of OPEC’s long-standing members and Africa’s largest oil producer, Nigeria stands to benefit from the slightly higher quota. However, its fiscal health remains vulnerable to fluctuations in prices.
The Nigerian National Petroleum Company Limited (NNPC) is banking on crude earnings to strengthen foreign exchange reserves and stabilize government revenue. But with oil prices slipping, those hopes could be challenged.
In anticipation of tighter margins, NNPC recently extended its crude supply deal with the 650,000-barrel-per-day Dangote Refinery for another two years. The agreement is meant to guarantee feedstock for the refinery and reduce Nigeria’s dependency on imported fuel — a critical step toward insulating the economy from global volatility.
However, that does not overshadow the unpredictability of the global oil environment. Reports of unsold cargoes from the Middle East are increasing, and futures markets are showing signs of weakness.
Shifting Strategies Inside OPEC+
The Saudi-Russian compromise is more than just a numbers game — it reflects deeper tensions within OPEC+, according to some analysts. Saudi Arabia, which carried much of the burden of past production cuts, is now signaling impatience. Crown Prince Mohammed bin Salman’s government appears eager to reclaim market share, especially as it prepares for next month’s Washington visit to meet President Donald Trump, who has been openly vocal about wanting lower oil prices to ease inflationary pressures.
At the same time, Russia’s alignment with a limited production boost shows its preference for price support as it continues to navigate sanctions and energy export restrictions.
The alliance’s production performance also exposes internal constraints. Of the 2.2 million barrels per day meant to be restored between May and September, barely 60% has materialized. Technical bottlenecks, overproduction penalties, and aging infrastructure have all limited the pace of recovery in several member nations.
Nigeria’s Output Gains
However, Nigeria’s oil production has shown steady improvement. Data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) shows that output in July 2025 averaged 1.71 million barrels per day — up 9.9% from a year earlier. The figure includes 1.507 million barrels of crude oil and 204,864 barrels of condensate.
Compared with June’s 1.69 million barrels per day, the increase is modest but significant, given years of operational challenges and pipeline sabotage. Forcados terminal led the recovery with 9.04 million barrels in July, up 2.1% from June, while Bonny terminal saw a sharper jump of 12.7%, producing 8.07 million barrels compared to 7.16 million in the previous month.
Even with production ticking upward, Nigeria — and OPEC+ more broadly — faces an increasingly fragile oil market. A continued glut is expected to push prices further down, eroding fiscal revenues and shaking confidence in the alliance’s management of supply.
Although the OPEC+ meeting lasted just nine minutes, the brevity of the session was itself telling. Delegates avoided public discussion of surplus risks, maintaining the group’s traditional optimism even as the IEA forecasts a possible record oversupply by 2026.
The next meeting, set for November 2, will determine whether the alliance sticks to its current cautious expansion or reverts to defending prices.