Oil prices saw a slight increase on Monday  following report surrounding the death of Iran’s President Ebrahim Raisi, his foreign minister and others in a helicopter crash. The development is seen to have contributed to the overall market sentiment, which also included last week’s gains.

Brent oil futures for July saw a 0.3 percent rise, reaching $84.19 a barrel, while West Texas Intermediate (WTI) crude futures experienced a 0.2 percent increase, trading at $79.70 a barrel.

In a tragic turn of events, a helicopter carrying Iranian President Ebrahim Raisi and Foreign Minister Hossein Amirabdollahian crashed over the weekend in the mountainous terrain of northwestern Iran, with both leaders report dead.  The loss of President Raisi comes at a time of heightened tensions between Iran and Israel, following a series of strikes exchanged earlier this year.

Prior to the  report, crude oil prices had been experiencing an upward trend due to several key factors. Positive indicators such as the possibility of U.S. interest rate cuts and improving demand in China have contributed to this increase in appetite for crude.

Furthermore, the U.S. government’s announcement of its purchase of approximately 3.3 million barrels of oil to refill the strategic petroleum reserve has also bolstered market confidence. However, ongoing instability in the Middle East and its potential impact on oil supplies remains a significant concern, keeping Brent oil prices above the $80 mark for most of 2024.

As the week unfolds, oil markets are exercising caution in anticipation of crucial announcements regarding U.S. interest rates and the economy. The release of the Federal Reserve’s late-April minutes and speeches from several Fed officials would also be closely scrutinised for insights into potential policy shifts.

Additionally, the upcoming Organization of Petroleum Exporting Countries and allies (OPEC+) meeting on June 1st is expected to provide updates on the cartel’s plans to maintain ongoing production cuts, which could have a significant impact on global oil supplies.

The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Mele Kyari, said the firm has destroyed over 600 illegal refineries in the last two years.

Kyari disclosed this during a stakeholder engagement between the Nigerian Association of Petroleum Explorationists and the NNPCL in Lagos, at the weekend.

He noted that the firm removed 5,800 illegal connections to Nigeria’s crude oil pipelines in the last two years.

According to him, the country is prospecting 1.7 million barrels per day in the coming months, up from April’s 1.28 mbpd.

The NNPCL boss also emphasised the need to fight insecurity in the oil and gas sector to increase production.

“How do you increase oil production? Remove the security challenges in our onshore assets. As we all know, the security challenge is real. It is not just about theft; it is about the availability of the infrastructure to deliver the volume to the market.

“No one will invest in oil production when he knows the production will not reach the market. Within the last two years, we have removed over 5,800 illegal connections from our pipelines and over 600 illegal refineries—cooking pots or whatever they were. You simply cannot get people to invest in it until you solve that problem,” he stated.

The Niger Delta Development Commission (NDDC) and the Shell Petroleum Development Company (SPDC) have completed the construction of the 25.7-kilometre Ogbia-Nembe Road in Bayelsa State.

The road project is slated to be commissioned on Saturday, May 25, 2024.

Speaking during a joint inspection of the project by officials of the two organisations, the NDDC Managing Director, Dr Samuel Ogbuku, described the multi-billion-naira project as a legacy and flag-ship of intervention in the Niger Delta region.

Ogbuku said that the “star project,” with seven bridges, 53 culverts and 4 spurs, linking 14 communities, was a good example of what could be achieved through collaboration of development agencies.

He declared, “The Ogbia-Nembe road as a model in partnership, with emphasis on quality job delivery. We have redefined our standards to globally acceptable best practice and we will henceforth compel our contractors to abide by them.”

The NDDC boss said that the NDDC would be banking on multinational corporations such as Shell, Chevron, and others to collaborate with the Commission in executing legacy projects, noting, “The oil giants have what it takes to provide funding, technical assistance, and expertise in environmental management, community development and corporate social responsibility.”

“The SPDC has shown that in addition to its statutory obligation to contribute to the funding of the NDDC, it is also necessary to work with the Commission on specific impactful projects. I am sure that other International Oil Companies, IOCs, will feel challenged to toe the line of Shell to provide quality infrastructure for the people of the Niger Delta.”

Ogbuku said that NDDC was already in discussion with Chevron on forging a partnership for the construction of the Warri-Omadino-Escravos Road, in Warri North Local Government Area of Delta State.

He observed that the project, when completed, would link Warri to Escravos which is the hub of oil and gas activities in Warri, which was very important to the economy of Delta State and Nigeria at large.

The SPDC Corporate Relations Manager, West, Chief Ucheoma Amechi, said that as a company that attaches importance to quality job delivery in the execution of development projects, Shell was satisfied with what has been achieved at the Ogbia-Nembe Road. He gave kudos to the NDDC for doing a good job in the execution of the signature project.

The NDDC Director, Environmental Protection and Control, Engr Onuoha Obeka noted that the road, which cut through swampy terrain, encountered many challenges.

He observed, “We are happy that in spite of the challenges, the project connecting about 14 communities in the Ogbia-Nembe axis of Bayelsa State, has been completed. These communities were hitherto, not accessible by road. This is the first connection between them and the upland and it will boost the socio-economic fortunes of the people.”

Obeka said that the project was an opportunity for the NDDC engineering crew to improve their skills.

He noted, “The challenges we met here were unique, building a road in the mangrove swamp. You will notice that both sides of the road are filled with water. The road was actually built on a sand embankment of 2.5 million cubic metres of sand.”

He explained: “The road traverses the communities of Opume, Emekalakala, Akipelai, Sabatoru, Obiama, Etiama, Igbeta-Ewoama, Agbakabiriyai, Ekese, Iwokiri, Otatubo, Basambiri and Nembe, the project comprises seven bridges and 53 culverts. It also comprises a main alignment of 19.7 kilometres, Opume spur of 1.45 kilometres, Emakalakala spur of 2.685 kilometres, Akipelai spur of 850 metres and Ogbolomabiri spur of 1.05 kilometres.

The Area Manager for SETRACO, Engr. Joseph Cosme, assured the joint inspection team that the Commission had completed all the minor repairs on the road in preparation for the commissioning ceremony.