 Thank you for joining us once again on the breakfast on plus TV Africa time for us to talk about the economy now all prices Rose Wednesday has OPEC and Russian led allies prepared to announce a big cut in its output Major oil producers led by Saudi Arabia and Russians are expected to announce a large court in the output to probe up Prices that spied Western concern over energy field inflation The 13 nation OPEC hotel and its 10 Russian Allies are reportedly considering a reduction of up to 2 million barrels per day at a meeting in Vietnam The biggest court since 2020 in a reminder of the global economic turmoil of the world trade organization Dramatically lowered its global trade focus for 2023 We have Zaka Bala an oil and gas analyst joining us from Kaduna. Thank you so much for being part of the show All right, then I like to share your thoughts on this development I mean and what it means for an oil dependent economy or You know economies that are exporting oil And the reason for that is to make sure they show up or the increase oil in the international market But even without doing that I can tell you the price of the crude oil in the international market is still looking good because it's slightly below $90 per barrel We shouldn't forget that there was a time it was below even 30 dollars per barrel So as it is right now, it is still economically feasible for so many countries Who organize their activities to produce at what we call Technically lower cost per foot You know, I will be able to to do well But what most importantly we need to understand that even without cutting the output There will still be a request or requirement for higher energy Because we are heading towards the winter energy requirements will go up We shouldn't also forget that there are so many countries that are still trying to recover From the tragedies of of the pandemic So there is this projection and plan to ramp up production And if there is a need to ramp up production in terms of goods and services There will be requirement for energy and technically you're talking about Hossil fuel, other crude oil or gas in this context But but this is this good news for Nigeria I mean, let's not forget that you know the projection or the quarter that has been giving to Nigeria We're looking at 1.8 30 million barrels per day and However, for several reasons we have not been able to meet the quota I mean we're producing below what's expected about 900,000 now if OPEC reduces The the outputs and then we have a new allocation. What exactly are we going to be doing really well? When I was responding to you from the initial question, I was trying to actually the oil and gas industry Globally and I was looking at the global strata of activities going on in the oil and gas industry But Nigeria is a unique case If we want to talk about the context of Nigeria Nigeria is not doing well Let nobody be deceived The problems of Nigeria as far as the oil and gas industry is concerned Artificial problems They are many problems and they are problems within Nigeria and they can be solved but for other countries that are Technically or reasonably organized They are producing They are meeting up with their open water Those are the kind of countries that will benefit whether they belong to the cartel of OPEC Or the non-OPEC cartel You know, led by OPEC and technically described as business climate hostilities And because of the hostilities, we cannot meet up with our OPEC quota We cannot meet up with our internal Production quota to even bridge what we can technically describe as budget deficit If we want to talk in the context of Nigeria All right how how this this is current Production cut or output cut by the Organizational Petroleum Exporting countries affect in, you know, the the local pump rise in Nigeria It will not have any impact Sorry, just to add to that, hearing that there's some scarcity expected in Abuja In the next few days. I don't know if that has anything to do with it. What's your sir? See in the context of Nigeria, we were not already meeting up with the quota We don't have refineries that are functional It is only Nigeria within this entire time of boom in production of cool oil and gas And the prices that has not been gaining or making any profit But let me put a caveat here when you talk to people probably in government Most of agencies of government. They may be telling you and talking about countries like Venezuela They will say Venezuela too is going through problem. But Venezuela has a unique problem. I mean everybody knows it Venezuela has Technical issues. They have serious political issues and they have some confrontations with some superpowers So anybody using Venezuela as an example is a very wrong example But when you look at kids from the context of Nigeria, all of you know that we have been having power grid failures countlessly and From that angle, we don't have electricity if you do not have electricity There will be no power if there is no power There will be no energy if there is no energy The strategic domestic sector strategic industrial sectors and strategic commercial sectors will not try if they do not try that means I mean there will be no profitability if there is no Profitability then they will not be able to break even and if they cannot break even the company income tax will go down Personal income tax will go down and by extension revenues to government will be affected and the GDP will be affected That is just one direction if you don't have internal food production and refining that means Destry distillate which we technically call refined products will have to be imported and That's why this will is expensive That's why agitation fuel is expensive. That's why kerosene is expensive. That's why cooking gas is expensive Then the worst part. I don't even want to say the satanic part How to do with the deregulation of prices? some of us kicked against it before the passage of the petroleum industry deal, but Nobody listening but those who were pressing as that and said Immediately you deregulate the prices The prices will be competitive Investors will come in they will invest and prices will go down around that time the price of diesel was around 80 Naira per liter The price has been deregulated now and the price of diesel is now heading towards 800 Naira per liter Where are the investors? They have not come Where are the investors are the prices coming down? We deregulated the price of aviation fuel. You can see what's happening in the aviation sector One way flight from Lagos to Abuja is about between 80 and 100,000 Nigerian Naira for economy ticket Where are the investors that are coming in to building additionary finalists? Where are the investors that we were told will come so you could see from that angle that we were being lied to At the point we were told that it was because of smuggling But it has been proven that it is not correct The only product that is yet to be deregulated is petrol And I can tell you as we speak now a certain of pure water is about 20 Naira If you deregulate the price of petrol a certain of water may may get to life 50 or 70 Naira So it's very clear that that deregulation was a dummy and a negative dummy That was sold to Nigeria. Where are the derived benefits? Just imagine what will have happened if we hadn't deregulated the price of diesel and aviation fuel Probably Nigeria will cease to exist Because we are told that just because we have not deregulated the price of PMS that Nigeria is spending about 7 trillion Naira will spend about that amount on subsidy on just petrol Just imagine if we had not deregulated The price of diesel and aviation fuel and kerosene Does it mean Nigeria will be spending probably 20 trillion Naira on subsidy? So do you expect Something is wrong with our economic managers call our political leaders But as Zaka Balad do you expect any hiccup any hitches in the form of probably Schesity in the coming days because of this increase in oil prices I will not be surprised because of I will not be surprised because we are relying on import The best way to describe Nigeria is a country Where you have produced so much beef But anytime you want to buy or eat Akara or Moimoi you will go and buy from somebody that does not even cultivate beef One way to describe Nigeria is in the context of the crude oil production gas and energy is you're talking about a farmer that produces So much cassava But every time the person wants to take gari and drink Also gari and drink or eat ever the person will go outside or go to somebody that does not cultivate cassava And buy gari or buy tapioca does that make sense? That's the context of Nigeria and let let let nobody feel we are either blasting our Economic or political leaders because you all who knows the truth. We are in the base of information They know the truth. They know that that's the way the economy of Nigeria is exact And he's heading towards the valley and I mean towards the cliff I will call us into the valley So even if you are studio things what I'm saying doesn't make sense I mean the global community knows there is nothing you can hide these days so in all of this that if there's going to be an oil price increase and You already have the fact that opaque is planning a cot, you know in terms of the outputs What's the interpretation of this? It's not be doomed for countries like Saudi Arabia It will not be a doom for country for Iran. It will not be a doom for countries like Iraq or Libya or other opaque nations that have organized their economies in such a way that they have enough crude oil for their internal consumption and Refining to make sure they distribute and take care of their citizens Internally what they may suffer may be a reduction in the revenues that they will generate because the production volumes will go down and The crude oil Or that they will be exporting the volume will come down and probably The revenues coming will be lowered and what they will be getting But already the crude oil that you produce for internal consumption has nothing to even do with opaque water But in the case of Nigeria the crude oil we cannot meet up with the internal production or opaque water and even the refined products are imported Like I said you you have these you produce so much these but you go to somebody who does not cultivate this To buy Akara or Muay Muay So it is bleak for Nigeria But you have mentioned the issue of you know not having refineries the refineries that we have Producing or I mean refinery Effectively, I mean performing that would be the word now Yeah, but if you look at but if you also look at you know some of the excuses and reasons have been given why We have not been able to meet up, you know our production quota by OPEC especially of recent time is that you have the old tests If you look at the pipelines The fact that our pipelines have been vandalized and what have you these issues also contribute to meeting our quota I like us to begin to you know look at how we can get out of the situation Is that really a short-term solution to getting out of all of this and ensuring that you know We're on top of the situation Excellent. God bless you for that question Is crude oil a problem in Saudi Arabia? Is crude oil a problem in Libya is crude oil a problem in Angola? Is it a problem in Gabon? Is it a problem in? Brazil is Good oil type a problem in China So who is fooling who? So if OPEC and non-OPEC member country crude oil type is not a Problem, why is it a problem in Nigeria? I want to begin is this you need to understand that Nigerian oil and gas companies are suffering from business climate hostilities Why is it that? Countries that are not as big as Nigeria They do not have the quantity of crude oil and gas reserve that we have in Nigeria But there is no crude oil or gas test Have we asked that problem and let me tell you if the crude oil and gas industry is suffering In a calamitous manner like this in Nigeria is the health sector not suffering the same fit Is the education sector doing well in Nigeria? is the The road infrastructure is doing well in Nigeria is the agricultural sector doing well in Nigeria is the situation in Nigeria better So the Nigeria problem is a holistic I don't want to use a demeaning phrase, but the Nigerian problem is a catastrophic problem that is internal We have to call it a day at that. I mean you've painted a picture of doom and gloom I know you're not a prophet of doom. You're just being realistic with what the situation is Is there any hope can anything be done just in in a sentence or two to at least Reduce the negative effect and impact on this on the Nigerian economy If you are 100% correct There is doom and gloom and there is hope But you hope will start by the leader telling the truth Because when the oil companies were running away our leaders were telling us that those oil companies were living to Invest in renewable energy that we shouldn't bother and that they are going away will not have any effect But we are seeing the negative effect That's one thing when things are not going well Leaders should feel bold to say it because the way children are to parents is the way Citizens are to lead us. We are not saying our leaders must be perfect There are no perfect leaders everywhere But if things are not going well, let us accept them The corruption is what is affecting the industry. Let us discuss it if it is security agents If it is the communities if it is the government agent if it is the oil companies that have sabotage Let us need to get and discuss as Nigerians and family Okay, fine solution. Thank you so much You said there's hope but you've given us some of things that need to be done And I think the problem I think you said is Leah should be truthful about the situation of things Thank you so much. Saka Bala all in gas and resources join us of video link from Kaduna. We appreciate your time Thank you, and congratulations to Nigeria again 62 We are still holding ourselves together until moving together as one united country Thank you That on its own gives me hope Fantastic fantastic. Well, thank you great way for us to end the conversation with you. We appreciate your time and your analysis this morning Well, that's the size of our conversation. We appreciate you I mean, thank you for being part of this joining from seven to nine about nine o'clock Of course at nine o'clock we'll join the newsroom for the news brief But if you missed out on any part of the conversation, it will be fantastic and great to follow us on Facebook, Twitter and Instagram and do subscribe to our YouTube channel We are at plus TV Africa and plus TV Africa lifestyle. My name is Messi Bopu. Let's do this tomorrow My name is Kofi Bartels. Have yourself a wonderful day. Good morning