US embassy cable - 04ABUJA1655

UNCLAS ABUJA 001655 
 
SIPDIS 
 
SENSITIVE BUT UNCLASSIFIED 
 
PARIS FOR OECD/IEA 
 
E.O. 12958: N/A 
TAGS: EPET, ENRG, PREL, NI, OIL 
SUBJECT: (U) DEMARCHE ON RELEASE OF CRUDE FROM 
STRATEGIC PETROLEUM RESERVES (SPR) 
 
REF:  DavisBa-Campbell email msg DTG 0923042247 
 
1. (U) At about noon September 24, Econ Counselor 
called on President Obasanjo's Special Advisor for 
Petroleum and Energy Edmund Daukoru and made the 
demarche requested via email.  Daukoru, who co-chairs 
the national oil company, is de facto minister of 
energy, since the President has not filled this 
position since 1999. 
 
2. (U) Daukoru appreciated the notice and said "what 
are reserves for, if not to be used."  The issue, if 
any, he said, might be the volume of crude to be 
released and the time by which an equivalent amount 
would be restituted to the SPR. 
 
3. (SBU) Daukoru went on that a side benefit of the 
release of crude from the SPR might be some dampening 
of international oil prices, which he deemed too high. 
He explained that OPEC ministers had recently 
concluded that prices preferably should move within a 
$30-35 band.  Despite the last-announced increase in 
quotas, prices above $40 a barrel are "outrageously 
high." Were prices to remain above $40, OPEC ministers 
would have to regroup to see if members could put more 
crude on the market. 
 
4. (SBU) Daukoru said Nigeria is now producing about 
2.2 mbd, which brings Nigeria's OPEC quota in line 
with Nigeria's actual, but temporary, capacity output. 
The need for maintenance at some facilities recently 
reduced capacity output from 2.5 mbd in June of this 
year. 
 
CAMPBELL