Nigeria’s oil sector lost an estimated N1.76tn in potential crude oil revenue due to its failure to meet the production quota set by the Organisation of the Petroleum Exporting Countries (OPEC) from January 2025 to January 2026.
Data from the Nigerian Upstream Petroleum Regulatory Commission revealed that the country’s crude oil production fell below the OPEC-set target of 1.5 million barrels per day in nine months in 2025 and repeated the same in the first month of 2026, even as global crude prices remained moderately strong.
According to the figures, Nigeria produced 1.54 mbpd in January 2025, exceeding its quota by about 40,000 barrels per day. Production also slightly exceeded the quota in June and July, with daily outputs of 1.51 mbpd, translating to surpluses of approximately 10,000–30,000 barrels per day.
However, production in February (1.47 mbpd), March (1.40 mbpd), April (1.49 mbpd), May (1.45 mbpd), August (1.43 mbpd), September (1.39 mbpd), October (1.40 mbpd), November (1.43 mbpd), and December (1.42 mbpd) fell below the benchmark.
The monthly shortfalls against the OPEC quota ranged from 10,000 barrels per day in April to 110,000 barrels per day in September, with the largest deficit recorded in September.
In February, average production stood at 1.47 mbpd. Over 28 days, this amounted to 41.16 million barrels, compared to the 42 million barrels expected under the quota, leaving a shortfall of 840,000 barrels. Output dropped further to 1.4 mbpd in March. Total production for the month was 43.4 million barrels instead of 46.5 million barrels, resulting in a deficit of 3.1 million barrels.
According to the data, crude production averaged 1.43 million barrels per day in April. Across 30 days, this translated to 42.9 million barrels, leaving a gap of 2.1 million barrels from the 45 million-barrel target for the month.
The fifth month recorded approximately 1.45 million barrels per day. Over the 31 days of May, Nigeria produced 44.95 million barrels against a quota requirement of 46.5 million barrels, leaving a deficit of 1.55 million barrels.
In August, production slipped to about 1.48 million barrels per day, yielding 45.88 million barrels compared to the expected 46.5 million barrels, creating a shortfall of 620,000 barrels. In September, production fell to 1.39 mbpd — the lowest in the year. Over 30 days, output reached 41.7 million barrels instead of 45 million barrels, leaving a shortfall of 3.3 million barrels.
Similarly, in October, average production of 1.44 million barrels per day resulted in 44.64 million barrels compared to 46.5 million barrels expected. The shortfall was 1.86 million barrels.
November recorded an average output of 1.46 mbpd; total production was 43.8 million barrels versus 45 million barrels under the quota. The deficit was 1.2 million barrels. In December, production hovered around 1.47 million barrels per day. Over the 31 days, Nigeria produced 45.57 million barrels instead of 46.5 million barrels, resulting in a gap of 930,000 barrels.
Cumulatively, these nine months produced a gross shortfall of approximately 18.7 million barrels.
However, January, June, and July recorded slight surpluses above the quota. After deducting the combined surplus from those three months, the net annual production deficit stood at 16.85 million barrels.
In January 2026, crude production stood at an average of 1.459 mbpd, resulting in a daily shortfall of 41,000 barrels per day. This translated to a shortfall of about 1.27 million barrels for the month. Consequently, from January 2025 to January 2026, Nigeria’s OPEC shortfalls accumulated to 18.12 million barrels.
According to data from the Central Bank of Nigeria, Bonny Light, Nigeria’s flagship crude grade, traded at elevated levels in the early part of the year before easing in the second quarter.
Bonny Light crude sold at an average of $80.76 per barrel in January 2025, declining to $77.08 in February and $74.44 in March. Prices dropped further in April to $69.07 and reached a low of $65.90 in May, reflecting softer global oil market conditions.
Prices recovered in June to $73.50 and remained largely stable in the third quarter, averaging $73.18 in July, $70.55 in August, and $70.20 in September, before falling again to $66.15 in October, the latest month for which CBN data were available.
Using the simple average of the 10 monthly Bonny Light prices published by the CBN, crude prices averaged $72.08 per barrel over the period under review. Multiplying 18.12 million barrels by $72.08 gives an estimated lost revenue of $1.31bn. At the prevailing exchange rate of N1,353 per dollar, this translates to approximately N1.76tn.
This loss came despite Nigeria’s total oil production for 2025 reaching 530.41 million barrels, generating gross revenue of about N55.5tn at the same average price and exchange rate.
Analysts noted that this figure represented gross inflows and did not account for production costs, joint venture cash calls, production-sharing contract cost recoveries, domestic obligations, or oil theft.
According to them, the underperformance against the OPEC quota highlights structural challenges in Nigeria’s oil sector, including operational disruptions, infrastructure constraints, security issues in the Niger Delta region, and fluctuations in production efficiency across different fields.
For comparison, Nigeria produced 1.54 mbpd in January 2025, exceeding the quota by 38,700 barrels per day, while the largest deficit occurred in September, when production averaged 1.39 mbpd, leaving a shortfall of about 110,000 barrels per day. These fluctuations underline the volatility that continues to affect Nigeria’s oil-dependent economy.
The shortfall also provides context for the 2026 oil benchmark, which is more conservative. The government has set a projected daily oil (crude and condensate) production of 1.84 million barrels, a benchmark crude oil price of $64.85 per barrel, and an average exchange rate of N1,400 per dollar, reflecting ongoing uncertainties in global oil markets and domestic production challenges. However, the January 2026 figure is not a good start for the 2026 budget.
An energy expert, Professor Emeritus Wumi Iledare, said meeting oil production targets would depend far less on ambitious projections and far more on practical, on-the-ground actions.
Iledare told The PUNCH that the government must prioritise improved security around oil assets, reduce operational disruptions, fast-track regulatory approvals, and create a stable operating environment that allows existing fields to produce at full capacity.
According to Iledare, Nigeria earned about N55tn from crude oil in 2025, up from roughly N50tn in 2024. “While this is an improvement, it still fell short of what the Federal Government expected for the year,” he said.
The don noted that the main issue was not oil prices but production. He explained that the government planned to produce 766.5 million barrels in 2025 but managed to produce only about 599.6 million barrels, meaning close to 167 million barrels were not produced, and the revenue that could have come with them was lost.
“Looking ahead to 2026, meeting oil production targets will depend far less on ambitious projections and far more on practical, on-the-ground actions. The government must prioritise improved security around oil assets, reduce operational disruptions, fast-track regulatory approvals, and create a stable operating environment that allows existing fields to produce at full capacity,” he stated.
He added that supporting investment in maintenance and infill drilling — while ensuring policy consistency — will be critical to converting planned barrels into actual barrels.
The expert called on the Independent Petroleum Producers Group to lead the charge by reopening shut-in wells. “In this regard, the IPPG holds a key role in near-term production expansion. With appropriate economic and policy incentives, re-entry into shut-in wells in the onshore and shallow-water basins could deliver meaningful production gains within the year,” Iledare explained.
A professor of economics, Segun Ajibola, said crude production volume is dependent on several factors, many of which are beyond the immediate control of the government.
According to him, the government can deploy resources towards oil exploration, but the overall impact depends on technical cooperation by partners, joint ventures, developments in the global oil market, and environmental conditions, among others.
Ajibola maintained that the Nigerian situation is complex, as the key agency in charge, the NNPC, has been enmeshed in controversies over the period.
Meanwhile, according to OPEC’s Monthly Oil Market Report, Nigeria produced about 1.46 million barrels of crude oil per day in January 2026, though output rose from 1.422 mbpd in December 2025 to 1.46 mbpd in January.
Despite the marginal improvement, production remained below the 1.5 mbpd quota, marking the sixth straight month the country has missed its OPEC target, spanning August 2025 to January 2026.
However, the new Chief Executive of the NUPRC, Oritsemeyiwa Eyesan, pledged to increase oil production. The NUPRC boss said her vision for the upstream sector rests on three pillars: production optimisation and revenue expansion; regulatory predictability and speed; and safe, governed and sustainable operations.
According to her, the agenda aligns with President Bola Tinubu’s Renewed Hope Agenda and the administration’s plan to grow Nigeria’s crude oil production to 2 mbpd by 2027 and 3 mbpd by 2030.
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