Nigeria’s crude oil export revenue fell to $12.1 billion in the second quarter of 2024, a slight decrease from $12.4 billion in the first quarter, as domestic oil production declined from 1.33 million barrels per day (bpd) in Q1 to 1.27 million bpd in Q2. This is according to the Central Bank of Nigeria’s (CBN) recent economic report.
The report highlights that Nigeria’s production deficit compared to its OPEC quota reached 308,000 bpd in the quarter. Ongoing challenges, including extensive oil theft, aging infrastructure, vandalism, and underinvestment, have hindered Nigeria’s ability to meet its OPEC-set target of 1.58 million bpd.
“Crude oil production continued to fall in Q2 2024, largely due to ongoing issues like oil theft and illegal refining in the Niger Delta,” the CBN report noted. Major production hubs, including the Forcados, Bonny, Qua-Iboe, Escravos, and Brass terminals, saw declines, contributing to the shortfall.
This drop in crude oil output was a significant factor in the 1.76% decline in Nigeria’s total export earnings, which fell to $13.94 billion in Q2 from $14.19 billion in Q1. Oil export earnings specifically dropped from $12.42 billion to $12.18 billion quarter-over-quarter.
Despite the production dip, rising prices of Nigeria’s Bonny Light crude, which averaged $86.97 per barrel in Q2 (up from $85.58 per barrel in Q1), helped offset some revenue losses. Non-oil exports also experienced a minor decline, reaching $1.76 billion from $1.77 billion in Q1, mainly due to reduced agricultural exports.
Crude oil and gas exports continued to dominate Nigeria’s total exports, making up 87.38%, while non-oil exports represented the remaining share.
On the import side, total merchandise imports fell by 20.59% in Q2, totaling $8.64 billion compared to $10.88 billion in Q1. This was mainly due to a decline in petroleum product imports, which dropped from $4.31 billion in Q1 to $2.79 billion in Q2. Non-oil imports also decreased to $5.85 billion from $6.57 billion previously, representing 67.72% of total imports.
Revenue in Nigeria’s gross federation account showed improvement in Q2, amounting to ₦6.28 trillion, a 26.37% increase from Q1. However, this was still 30.17% below the expected benchmark. The boost in revenue stemmed from higher earnings from royalties, Petroleum Profit Tax (PPT), and independent government revenues, as well as Company Income Tax (CIT) from the oil sector.
Within the federation account, non-oil revenue was predominant, contributing 72.42% to the total earnings, while oil revenues made up the remaining portion. The non-oil revenue of ₦4.55 trillion exceeded both the previous quarter’s figures and its quarterly target, driven by increased Value Added Tax (VAT) collections, customs, excise duties, and independent revenue sources.
The CBN report also noted improvements in Nigeria’s electricity sector, with average electricity generation rising by 6.19% in Q2 to 4,095.24 megawatt-hours, compared to 3,856.50 MW/h in Q1. Average electricity consumption also grew by 4.47%, from 3,750.40 MW/h in Q1 to 3,918.15 MW/h in
