Nigeria, Africa’s largest oil producer, lost an estimated $1.31 billion in potential crude oil revenue between January 2025 and January 2026 after repeatedly failing to meet its production quota set by the Organisation of the Petroleum Exporting Countries, according to official data.
Figures from the Nigerian Upstream Petroleum Regulatory Commission show the country underperformed its 1.5 million barrels per day quota in nine months of 2025 and again in January 2026.
Using the Central Bank of Nigeria’s average Bonny Light price of $72.08 per barrel over 10 months of available data, the cumulative shortfall of 18.12 million barrels translates to roughly $1.31 billion in lost gross revenue, or approximately N1.76 trillion at an exchange rate of N1,353 per dollar, as seen on Business Insider Africa.
The missed output occurred despite relatively strong global oil prices for much of the period.
Bonny Light traded at an average of $80.76 per barrel in January 2025 before easing to $65.90 by May, stabilising between $70 and $73 in the third quarter, and dipping again in October. Production data reveal month-to-month volatility.
Nigeria exceeded its OPEC ceiling only three times in 2025, in January, June, and July, while falling short in February, March, April, May, August, September, October, November, and December.
The steepest deficit occurred in September, when production dropped to 1.39 million barrels per day, about 110,000 barrels below the quota, amounting to a 3.3 million barrel shortfall over 30 days.
By contrast, January 2025 output of 1.54 million barrels per day exceeded the quota by roughly 40,000 barrels per day.
Cumulatively, nine months of underperformance in 2025 produced a gross shortfall of 18.7 million barrels.
After accounting for modest surpluses earlier in the year, the net deficit stood at 16.85 million barrels, with January 2026 adding 1.27 million barrels to bring the 13-month shortfall to 18.12 million barrels.
Despite the revenue gap, Nigeria produced about 530.41 million barrels of crude in 2025, generating an estimated N55.5 trillion in gross revenue.
Analysts caution that this reflects gross inflows and does not consider production costs, joint-venture cash calls, production-sharing recoveries, domestic supply obligations, or oil theft.
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For policymakers, the real concern lies in volumes rather than prices. Professor Emeritus Wumi Iledare noted, “Meeting oil production targets will depend far less on ambitious projections and far more on practical, on-the-ground actions.”
He emphasized the need for better security around oil assets, fewer operational disruptions, faster regulatory approvals, and a stable environment to allow existing fields to operate at capacity.
Investment in maintenance, infill drilling, and policy consistency is also critical to converting planned barrels into actual production.
Budget benchmarks are under pressure as missed OPEC targets persist.
Iledare said Nigeria earned roughly N55 trillion from crude in 2025, up from N50 trillion in 2024, but still below federal projections.
The government had aimed to produce 766.5 million barrels in 2025 but managed closer to 599.6 million barrels, leaving around 167 million barrels unrealized.
Professor Segun Ajibola added that crude output depends on factors beyond government control, including joint-venture cooperation, global market conditions, environmental factors, and controversies surrounding the state oil company, which complicate reform efforts.
Data from OPEC’s Monthly Oil Market Report indicate Nigeria produced around 1.46 million barrels per day in January 2026, up slightly from 1.422 million barrels per day in December.
Output remained below the 1.5 million barrel quota, marking the sixth consecutive month of missed targets from August 2025 through January 2026.
This shortfall threatens Nigeria’s 2026 budget assumptions, which use a more conservative oil benchmark of 1.84 million barrels per day, a price of $64.85 per barrel, and an exchange rate of N1,400 per dollar.
Oritsemeyiwa Eyesan, the new chief executive of the Nigerian Upstream Petroleum Regulatory Commission, pledged to lift output through production optimization, regulatory predictability, and safe, sustainable operations.
The plan aligns with President Bola Tinubu’s target of raising crude production to 2 million barrels per day by 2027 and 3 million by 2030.
International investors continue to monitor Nigeria closely, as its production performance impacts both domestic fiscal health and broader global energy markets.
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Image Credit: South China Morning Post
