ORGANISATION of Petroleum Exporting Countries (OPEC) has attributed the current global crude oil price volatility to continued uncertainty, stemming from the slow pace of global economic growth, continued Euro-zone debt crises, high unemployment in advanced economies and the risk of inflation in developing countries.

Already, there have been fluctuations in crude oil prices going below $98 per barrel and this is setting off warnings about the ability of Nigeria to fund its yearly budget.

The National Assembly passed a N4.987 trillion budget for 2013 last December, based on oil production of 2.562 million barrel per day; however the crude oil production assumption contained in the 2013 budget was never achieved in 2012.

The budget is also predicated on a $79 per barrel price, which is getting increasingly squeezed as oil prices retreat.

OPEC 163rd Meeting conference President, Dr. Abedel All Al-Arous, who made this disclosure at the weekend in a speech pasted on the cartel website, in Vienna, added that these factors have contributed to dampening what appeared as a clear momentum in global economic recovery at the beginning of the year.

According to Al-Arous, there have been continuing fluctuations in the oil price, with a general downward trend in the last few months. “In mid-April, we saw the reference basket price reach $98 a barrel. It then fluctuated for the remainder of the month, ending at $101.05/bbl from $106.86/bbl, a drop of $5.81/bbl (5.75 per cent) and is presently averaging at $100.85/bbl”, he added.

He disclosed that the world oil demand growth forecast is expected to increase by 0.8 mbpd in 2013. “Total non-OPEC supply has seen a slight upward adjustment to 1.0 mbpd for the year while OPEC natural gas liquids and non-conventional oils are also expected to grow by 0.2 per cent. This situation is likely to continue through the third and into the fourth quarters as we head into the driving season”.

He assured that OPEC would closely monitor developments in the oil market in the coming months. It will also continue its efforts to achieve a stable oil market by ensuring that the market is well supplied to meet demand from consumers at fair and reasonable prices.

Also, the shale revolution, which has reduced United States (U.S.) crude imports to a 15-year low, dominated discussion on the sidelines of the Vienna meeting.

OPEC Secretary General, Abdalla el-Badri, said oil ministers from member countries were seeking more information on the scale of the challenge it presents to the cartel.

“Ministers would like to know the magnitude of this supply, how long it would last, the sustainability, its cost and effect on environment,” El Badri said.

The cartel is split on its views about the impact of the boom in shale oilfields such as the Bakken in North Dakota and Eagle Ford in Texas. While Saudi Arabia and other Gulf exporters have seen their U.S. sales hold steady, or even increase over the last five years, West African members Nigeria and Angola have seen exports to the U.S. decline sharply.

Saudi oil minister, Ali al-Naimi, said the cartel would weather the shale boom as it had with new supplies from the North Sea in the 1980s and deepwater wells in the Gulf of Mexico in the 2000s.