Macroeconomic Report & Economic Updates

Nigeria Economic Update (Issue 18)

According to the Organization of Petroleum Exporting Countries (OPEC) May 2022 oil report, Nigeria’s oil production fell in April 2022.1 The report shows that Nigeria produced an average of 1.22 million barrels per day (mb/d) of crude oil in April 2022. This production level is approximately 18,000 barrels per day (b/d) lower than 1.24 mb/d recorded in March 2022. In addition, total production is about 500,000 b/d lower than 1.74 mb/d OPEC assigned quota for the country. At US$ 100 per barrel, which is lower than the prevailing market price, the shortfall in production results in a loss of crude oil export earnings valued at over US$ 50 million per day, which also indicates a shortfall in Government revenue from crude oil royalty. These findings indicate that Nigeria is not maximising additional oil revenue associated with the surge in crude oil prices in the international market since Russia’s invasion of Ukraine. Nigeria’s declining crude oil production is due to low investment and other factors, including persistent oil theft and pipeline vandalism. For Nigeria to achieve the OPEC crude oil production quota, a result-oriented collaboration between the government and the private sector is required. The collaboration would lead to policies that eliminate bottlenecks hindering investment in the oil and gas sector. The collaboration would also ensure increased uptake of digital technologies in protecting the pipelines and the fast-track implementation of the revised PIA.

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March 13, 2018 - 4:00 am
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