Figures from the Nigerian Upstream Petroleum Regulatory Commission show that Africa’s largest oil producer 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 the 10 months for which data were available, the cumulative shortfall of 18.12 million barrels translates to roughly $1.31bn in lost gross revenue. At an exchange rate of N1,353 per dollar, this amounts to approximately N1.76 trillion.
The missed output came despite relatively firm global prices for much of the period. Bonny Light, Nigeria’s flagship grade, traded at an average of $80.76 per barrel in January 2025 before easing to $65.90 by May amid softer market conditions. Prices stabilised in the third quarter, averaging between $70 and $73 per barrel, before dipping again in October.
Production data reveal sharp month-to-month volatility. Nigeria exceeded its OPEC ceiling only three times in 2025, in January, June, and July. In contrast, output fell short in February, March, April, May, August, September, October, November, and December.
The steepest deficit occurred in September 2025, when production dropped to 1.39 million barrels per day, around 110,000 barrels below the quota. Over 30 days, that gap amounted to 3.3 million barrels. By comparison, January 2025 saw output of 1.54 million barrels per day, exceeding the ceiling by approximately 40,000 barrels per day.
Why Output, Not Oil Prices, Is Nigeria’s Real Fiscal Risk
Cumulatively, nine months of underperformance in 2025 produced a gross shortfall of 18.7 million barrels. After adjusting for modest surpluses earlier in the year, the net deficit stood at 16.85 million barrels.
In January 2026, an additional 1.27 million barrels were added to the tally, bringing the 13-month shortfall to 18.12 million barrels.
The revenue gap is striking even against a backdrop of strong headline earnings. Nigeria produced about 530.41 million barrels of crude in 2025, generating an estimated N55.5 trillion in gross revenue at the same average price and exchange rate assumptions.
Analysts caution, however, that this figure reflects gross inflows and does not account for production costs, joint-venture cash calls, production-sharing-contract recoveries, domestic supply obligations, or oil theft.
For policymakers in Abuja, the concern is less about prices and more about volumes. Professor Emeritus Wumi Iledare argued that “meeting oil production targets will depend far less on ambitious projections and far more on practical, on-the-ground actions.”
He said that improved security around oil assets, fewer operational disruptions, faster regulatory approvals, and a stable operating environment were essential to enable existing fields to operate at capacity. Supporting investment in maintenance and infill drilling, alongside policy consistency, would also be critical to converting planned barrels into actual barrels.
Budget Benchmarks Under Pressure as OPEC Misses Persist
According to Iledare, Nigeria earned roughly N55tn from crude in 2025, up from about N50tn in 2024, yet still below federal projections. He added that the government had planned to produce 766.5 million barrels in 2025 but managed closer to 599.6 million barrels, leaving about 167 million barrels unrealised.
Segun Ajibola, a professor of economics, noted that crude oil output depends on factors not entirely within the government’s control. These include technical cooperation among joint venture partners, developments in the global oil market, and environmental conditions. He also pointed to controversies surrounding the state oil company, which have complicated reform efforts.
Data from OPEC’s Monthly Oil Market Report indicate that Nigeria produced around 1.46 million barrels per day in January 2026, up slightly from 1.422 million barrels per day in December. Even so, output remained below the 1.5 million barrel quota, marking the sixth consecutive month of missed targets from August 2025 through January 2026.
The production slippage casts a shadow over Nigeria’s 2026 budget assumptions. The government has adopted a more conservative oil benchmark, projecting daily production of 1.84 million barrels, including condensates, at a benchmark price of $64.85 per barrel and an exchange rate of N1,400 to the dollar. January’s figures suggest the year has begun on a fragile footing.
Oritsemeyiwa Eyesan, the new chief executive of the regulator, has pledged to lift output, outlining a strategy built on production optimisation and revenue expansion, regulatory predictability and speed, and safe, sustainable operations. The ambition aligns with President Bola Tinubu’s target of raising crude production to 2 million barrels per day by 2027 and 3 million by 2030.
For international investors in New York, London, Toronto, and Beijing, Nigeria’s performance remains closely watched. As Africa’s largest economy and a key member of OPEC, it can stabilise output, with implications not only for domestic fiscal health but also for broader supply expectations in global energy markets.
