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Page last updated at 04:15 GMT, Saturday, 26 April 2008 05:15 UK

Oil firms in Nigeria cut output

Children play on an abandoned Shell oil flow station in Nigeria
Although demand is high, oil output in Nigeria is falling

Industrial action and attacks from militants have forced the two biggest oil companies in Nigeria to cut their production.

Exxon Mobil and Royal Dutch Shell are both reducing output, which is helping to keep oil prices near record highs.

Militant groups in the Niger Delta have blown up a section of a Shell pipeline, in the fourth such attack in the last seven days.

And workers at an Exxon Mobil plant began a strike over pay and conditions.

The company said production was affected, but would not say by how much.

Volatile markets

But as Nigeria is the world's eighth largest oil exporter, it is certain to worry the volatile global oil markets.

Our candid advice to the oil majors is that they should not waste their time repairing any lines, as we will continue to sabotage them
Militant statement

The BBC's correspondent in Lagos, Alex Last, says that strikes in the country rarely last very long, but that attacks on the pipelines which criss-cross the forests and creeks of the delta are almost impossible to stop.

A faction loyal to the imprisoned militant leader, Henry Okah, has said it is responsible for the latest attacks.

The group is keen to gain attention, as Mr Okah is being tried in secret for treason and gun-running.

The Movement for the Emancipation of the Niger Delta promised further violence.

"Our candid advice to the oil majors is that they should not waste their time repairing any lines, as we will continue to sabotage them", the militants said in a statement.

Demand is high for Nigeria's oil, which is easily refined.

But production is now running about 25% short of the official capacity of 2.5 million barrels a day.

Exxon Mobil said it was operating at "partial production" following the industrial action, while Shell said it may not be able to meet its target of shipping 169,000 barrels a day from the country over the next few weeks, after the militants' attacks.





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