Doubts cloud Nigeria's production outlook

Following a series of production setbacks, Nigeria has announced that its output capacity will rise by 0.5 mn bpd between now and the end of the year to 3.0 mn bpd. Production has been hit by unrest in the oil-producing Delta region, sabotage to pipelines, strikes and the theft of substantial volumes of crude oil. The government has recently declared that the security situation has improved and that some 140,000 bpd of production at Chevron's Escravos field-shut in by unrest since March 2003-will be restored before the end of the year. A further 125,000 bpd is due to be added when Shell's deep-water Bonga field is commissioned later this year. Nigeria may nevertheless struggle to hit this year's capacity target and future ones as well.