Nigeria’s average daily crude oil production has fallen to 1.40 million barrels per day in March, down from 1.465 million barrels per day in February, according to data released by the Nigerian Upstream Petroleum Regulatory Commission. This decline threatens the nation’s budget as the world battles a global crude price crash.
The commission reported that the daily average production in March was 1,603,776 barrels per day, comprising both crude oil (1,400,783 barrels per day) and condensate (202,993 barrels per day). This represents 93% of the OPEC quota of 1.5 million barrels per day.
Nigeria has struggled to meet its OPEC oil production quotas due to crude oil theft and pipeline vandalism. Despite a brief surge in production in January, the country has failed to sustain the momentum, casting doubts on the feasibility of ramping up production to 2 million barrels per day this year.
The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has expressed confidence that Nigeria can hit 3 million barrels per day this year, including crude and condensates. He said, “We would ramp up production by following the ‘Drill, baby drill’ slogan… We would raise production without having issues with OPEC.
However, experts are concerned about the possibility of this target given the current decline in daily oil output and the global crude price crash. The price of crude oil has fallen by over $10 below the $75 per barrel projected by the Federal Government in the 2025 budget, with Brent crude currently trading at $64.76 per barrel and WTI at $61.50 per barrel.
According to Argus Media, Nigerian crude oil grades faced tepid demand in the April trade cycle due to ample availability of lower-priced alternatives. The report stated that 15 April-loading Nigerian cargoes are still looking for buyers, which could further affect the country’s revenue projections in the 2025 budget. Experts argue that these factors will impact Nigeria’s revenue projections, making it challenging to achieve its budget targets
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