Nigeria’s Crude Oil Sales Soar to N5.14 Trillion in Q1 2023, Despite Declining Oil Prices

Nigeria, Africa’s largest crude oil producer, generated N5.14 trillion in revenue from crude oil in the first quarter (Q1) of 2023.

This represents an improvement from the N4.9 trillion achieved in the previous quarter despite global oil prices declining by 6 percent from $88.5 a barrel it was sold in the final quarter of 2022 to about $79 per barrel in Q1 2023.

According to the National Bureau of Statistics, Africa’s largest oil producer realised N4.6 trillion, N4.9 trillion and N5.1 trillion in crude oil revenue in Q3 2022, Q4 2022 and Q1 2023, respectively.

Crude oil accounted for 79.37 percent of Nigeria’s foreign trade.

Joshua Olorunmaiye, an energy lawyer at Bloomfield LP explained that the ongoing “Russia-Ukraine war has contributed to a growing demand for oil and gas, with EU countries and countries like the United States and India among others are searching for alternatives to Russian supply.”

He also said efforts by the Federal Government to arrest oil theft might have contributed to the improvement recorded in the quarter under review.

“Certain technologies have been deployed which help to monitor and report. There has also been more collaboration between security forces, community groups and the government agencies in the sector, ensuring that overall, production is ramped up and more crude arrives at its destination and is sold for the benefit of the economy,” Olorunmaiye said.

Recent analysis indicates that Nigeria’s oil output remained stable for the past five months until experiencing a decline to 1.26 million barrels per day (bpd) in March 2023.

In April, a report from OPEC revealed an additional decline below 1 million bpd for the month.

“However, the current OPEC quota would be maintained till the end of 2023; This implies that Nigeria can ramp up its production up to its current quota of 1.743m bpd and subsequently be capped at 10 percent less as its quota for 2024 subject to verification by independent secondary sources,” said Gabriel Aduda, permanent secretary Ministry of Petroleum Resources.

“This will be complemented by a condensate of about 400KBD ultimately upping Nigeria’s crude oil and condensate production to about two million barrels per day in 2024.”