The production of crude oil from Nigeria increased to 1.53 million barrels per day (COPD) in January, marking an important step while the country has reached its production quota of the Organization of Oil Exporting Countries (OPEC) For the first time since it was set at 1.5 million BPDs for the 2024 period.
The production objective, created at the OPEC ministerial meeting on November 30, 2023, remained elusive for more than a year, which aroused concerns about Nigeria’s ability to maintain production levels in the middle persistent challenges in the sector.
The latest monthly OPEC oil market report, published on Wednesday, cited direct communication figures with Nigerian authorities confirming the increase in production. The report indicated that the gross production of January represents an increase of 54,000 BPD or 3.6% compared to 1.48 million B / J-BPD in December 2024. This development cement the position of Nigeria as A great producer of African oil, exceeding Algeria, which recorded a production of 907,000 BPD during the same period. The Congo, with a production of 251,000 b / d, has classified as the third producer on the continent.
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OPEC has also noted that secondary sources, such as energy intelligence platforms, reported a slight drop in raw production in Nigeria. According to these alternative estimates, production fell by 2% to reach 1.49 million b / d in January, against 1.52 million b / d in December 2024. This difference between data sources is not uncommon In the oil declaration and highlights continuous concerns concerning the transparency of production and reliability of figures.
Beyond Nigeria, the wider production of OPEC-12 crude oil experienced a marginal drop, with an average of 40.62 million barrels per day in January 2025, which represents a decrease of 118,000 B / J compared to the previous month. While Libya, Congo and Gabon have increased production, production levels in Nigeria, the United Arab Emirates (Water) and Venezuela have decreased. In addition, non -OPEC + gross production was on average 13.94 million b / d, with notable increases from Kazakhstan, while Russian production has decreased.
Oil revenues and growing concerns of the Nigeria budget deficit
The sharp increase in oil production from Nigeria is involved at a critical time, because President Bola Tinubu recently submitted a budget revised in 2025 to the National Assembly, which increased it from 49.7 Billions of Nairas to 54 , 2 Billions of Nairas. The latest adjustment, which the president has attributed to additional income projections of the main government agencies, has raised concerns among economic analysts and political observers that Nigeria could go to another important budget deficit.
With the profile of the debt of Nigeria already an increasing concern, the increase in public spending, combined with the fluctuating performance of the main sources of income, has aroused debates on the way the administration plans to finance the new budget without deepening more the country’s budgetary crisis. Nigeria has fought against the generation of income, the oil remaining the main source of exchange gains in the country despite the continuous efforts to diversify the economy.
Thus, the latest increase in oil production should have a positive impact on government revenues if it is supported, offering the administration an essential increase to finance the extended budget. Brut oil represents more than 80% of Nigeria exchange benefits.
However, economic analysts warn that if the increase in oil production is a positive development, the Nigeria’s ability to fully capitalize on the increase in production will depend on world oil prices, the stability of production and effective income management. If crude prices remain strong and Nigeria maintains or exceeds the quota of 1.5 million b / d, it could partially compensate for the budgetary tension and reduce the country’s dependence on external borrowing. However, if production levels fluctuate due to oil, vandalism or regulatory challenges, expected financial relief may not materialize.
The role of the Dangote refinery in strengthening the Nigeria petroleum sector
The OPEC report also underlined the expectations that the production of crude oil from Nigeria would increase more in the coming months, thanks to the progress of the Dangote refinery to full operational capacity. The refinery, the largest in Africa, should transform the Nigeria energy sector by reducing dependence on imported oil products while creating a reliable domestic market for the gross produced locally.
“The oil sector remains at the heart of the economy, and the Dangote refinery reaching full production capacity should help stabilize the supply of petroleum products and possibly a drop in petrol prices,” noted OPEC in the report.
Edwin Devakumar, vice-president of Dangote Industries Limited (DIL), recently said that the refinery should reach full capacity within 30 days. During advanced exploitation, the installation will deal with around 650,000 crude barrels per day, according to levels of production experts, it is more than sufficient to meet the domestic demand of Nigeria of petroleum products while allowing a surplus. export refining.
Can Nigeria reach 3 million BPD by 2025?
According to Heineken Lokpobiri, Minister of State for Oil Resources (OIL), the positive federal government set an even more ambitious target to achieve 3 million b / d in 2025. However, this objective remains difficult, given the persistent problems Theft of oil, vandalism of pipeline, under-investment in exploration and an aging infrastructure.
Security problems play a major role in production fluctuations. The Niger Delta, the Nigeria oil producer region, has long been plagued by pipeline sabotage and oil theft, with billions of dollars lost each year against illicit activities. The government’s continuous security interventions have given mixed results and industry experts warn that without a lasting solution, the maintenance of regular production greater than 1.5 million b / d will remain a struggle.
In addition, while the Dangote refinery promises to facilitate the dependence of Nigeria with regard to imported refined oil products, it also presents a new dynamic for the country’s crude oil market. If the refinery is obtaining a majority of its raw materials at the national level, it could modify the export models of Nigeria and have an impact on government revenues.
