Nigeria Concerns Increase, Oil Price Breaks Record

Nigeria is the fifth largest member of the Organization of Petroleum Exporting Countries (OPEC). The sudden upsurge in the oil prices resulted from a culmination of problems in Russia, Saudi Arabia, Iraq, and Nigeria.

US crude oil hit $49.60 a barrel, the highest figure since 1983. Almost exactly a month ago oil prices had reached $49.40 per barrel. North Sea Brent crude pushed $46.20 a barrel before closing at $46.10.

Rebels who lost control of the Niger region are demanding political reforms in regards to oil production. The situation prompted Royal Dutch/Shell to shut down a small facility that produces 30,000 barrels per day.

Shell also withdrew some of its workers because of the ongoing clashes between the militia and the Nigerian army. The unrest threatens the country’s daily shipment of 2.5 million barrels.

Russia added to the market’s woes because its oil giant Yukos cannot guarantee deliveries due to the company’s financial crisis.

OPEC is already operating near full capacity, churning out 30 million barrels per day to meet the demands of expanding countries like China, the US, and India.