Joseph Bakare/Ijeoma Agudosi
Experts at the 6th African Petroleum Congress and Exhibition in Abuja have called for closer industry tie than exerting energy on freezing crude oil supply which they think cannot not lead to rebound of global oil price.
Oil producing countries are working toward agreeing to freezing crude oil supply,with the hope it would help drive the price of the commodity.
Mr Clay Neff, Chairman, Oil Producer Trade Section (OPTS) of the Lagos Chamber of Commerce and Industry (LCCI), said at the event that effective collaboration was critical in overcoming the challenges facing the petroleum industry.
He said that it was critical that producing countries, consuming countries, IOCs and all stakeholders in the oil and gas industry must collaborate to tackle the challenges in the industry.
Neff, who is also Chairman and Managing Director, Chevron Nigeria Limited, said that collaboration would throw up practical solutions and would help drive the industry.
“The good news is that the industry and the Federal Government are collaborating to mitigate these challenges.
“I am optimistic the collaborations will lead to the surmounting of the current challenges in the industry, especially in Nigeria,” he said.
Also, Prof. Adeola Adenikinju of University of Ibadan, called for greater collaboration, both locally and internationally to help ensure that oil-producing countries benefited from economies of scale.
He said that due to issues surrounding energy efficiency, freezing supply of crude oil would only lead to a marginal increase in the price of the commodity.
According to him, supply freeze will not bring about a significant upward movement in the price; it will also not take back the prices to the former levels.
He called on the Federal Government to improve on the competitiveness of the country’s economy, especially on doing business conditions.
The professor also advised that there should be development of medium to long term strategies to anticipate developments in the oil markets.
He said that the current emphasis on crude petroleum exports must be discontinued and replaced in preference for viewing petroleum as a source of energy and growth enablers.
Adenikinju said that the volatility in the price of crude oil had brought to the fore the fact that energy transition, away from fossil fuel, was real and had come to stay.
He identified strategies for dealing with sustainable pricing to include cost management; encouraging private investments in industries where petroleum is feed-stock and joint collaboration for infrastructure development.
Others, he said, included co-integration of upstream and downstream operations and developing the linkage between petroleum and the rest of the economy.