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Nigeria Earns N41.7trn from Crude Oil in Six Months

Nigeria produced an estimated 295.18 million barrels of crude oil and condensate valued at about $28.08bn (approximately N41.74tn) in the first six months of 2026, reflecting a modest recovery from the second half of last year despite a slight decline compared to the corresponding period of 2025.

A comprehensive analysis of production figures released by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) on Wednesday showed that average crude oil and condensate production stood at 1.63 million barrels per day between January and June 2026.

The production, valued using monthly Bonny Light crude oil prices and converted using the Central Bank of Nigeria’s monthly average official exchange rates, highlights the enormous value of Nigeria’s hydrocarbon resources, even as the country continues to grapple with production challenges, oil theft and fluctuating international crude prices.

The analysis showed that Nigeria’s first-half production increased by 1.93 per cent compared to the estimated 289.59 million barrels produced in the second half of 2025.

However, output remained below the 298.85 million barrels recorded in the first six months of 2025, representing a 1.23 per cent year-on-year decline, indicating that although production has improved in recent months, it has yet to fully recover to last year’s levels.

The data showed that the country produced 50.45 million barrels in January, 41.55 million barrels in February, 48.49 million barrels in March, 49.90 million barrels in April, 52.72 million barrels in May, and 52.06 million barrels in June.

A month-by-month analysis showed that the year kicked off with a solid January performance, averaging 1,627,460 barrels per day over 31 days to yield a monthly total of 50,451,260 barrels.

However, February saw a sharp decline of 8.82 per cent in daily output, dropping to 1,483,940 bpd. Combined with the shorter 28-day month, February’s total output dipped to 41,550,320 barrels. March initiated a recovery, with daily production climbing 5.40 per cent to 1,564,100 bpd over 31 days, bringing total output to 48,487,100 barrels.

This upward momentum accelerated throughout the second quarter. Daily production in April jumped 6.35 per cent to 1,663,430 bpd over 30 days, totalling 49,902,900 barrels. May maintained the momentum, with a 2.25 per cent daily increase to 1,700,800 bpd. Across its 31 days, the month delivered the highest production volume of the half-year at 52,724,800 barrels.

June closed the second quarter on a high note, with daily output rising another 2.03 per cent to 1,735,398 bpd over 30 days, contributing 52,061,940 barrels to the half-year total. The monthly shift in production volumes, coupled with global oil price volatility, heavily impacted revenue generation throughout the first half of the year.

Using the average monthly Bonny Light prices, the estimated gross value of production in dollar terms stood at $3.43bn in January before dropping 12.24 per cent to $3.01bn in February. March recorded a 70.76 per cent surge amid Middle East tensions to $5.14bn, a growth streak that continued into April with a 22.96 per cent increase to a peak of $6.32bn.

However, revenues contracted in the final two months of the half-year, falling 6.01 per cent to $5.94bn in May and declining a further 28.62 per cent to close June at $4.24bn. When converted using the Central Bank of Nigeria’s monthly average exchange rates, the local currency returns mirrored this volatile trajectory.

The estimated gross value in January stood at N5.18tn before declining 12.74 per cent to N4.52tn in February. March recorded a sharp 70.58 per cent increase to N7.71tn, followed by a 21.92 per cent rise in April to a half-year high of N9.40tn.

The valuation then declined in the final two months, sliding 7.02 per cent to N8.74tn in May and dropping another 29.18 per cent to end June at N6.19tn. Altogether, Nigeria’s crude oil and condensate production for the six-month period was worth an estimated N41.74tn.

Economic Confidential reports that the figures represent the gross market value of crude oil and condensate produced and should not be mistaken for government earnings. Actual government revenue is significantly lower after accounting for production costs, royalties, taxes, profit-sharing arrangements under joint ventures and production-sharing contracts, as well as crude oil allocated to investment partners.

The gradual improvement in production aligns with the Federal Government’s intensified efforts to curb crude oil theft, secure oil infrastructure and encourage upstream investments under the Petroleum Industry Act.

The government has repeatedly stated that increasing crude oil production remains one of its key priorities for improving foreign exchange earnings, boosting government revenue, and strengthening Nigeria’s fiscal position. Nigeria has also continued to benefit from relatively strong international crude oil prices during parts of the year.

Bonny Light crude averaged $68.05 per barrel in January before rising to $72.33 in February, $106.09 in March, and peaking at $126.71 per barrel in April amid heightened geopolitical tensions and supply concerns. Prices later moderated to $112.63 in May and $81.48 in June.

Recall that on Sunday, the NUPRC announced that crude oil production had climbed to its highest level in more than six years, with the country exceeding its Organisation of the Petroleum Exporting Countries production quota for the fourth consecutive month, buoyed by improved operational stability and fewer disruptions to oil infrastructure.

Despite the improved production performance, the country’s average output remains below the Organisation of the Petroleum Exporting Countries production quota for most months, underscoring the need for sustained investment, improved security and higher operational efficiency across the upstream sector.

The estimated N41.74tn gross value of Nigeria’s crude oil and condensate production in the first six months of 2026 represents a significant portion of the Federal Government’s projected N60.97tn oil revenue for the full 2026 fiscal year.

Sustaining production above 1.7 million barrels per day in the second half of the year will be critical if Nigeria hopes to meet its budget assumptions, improve foreign exchange inflows and maximise the benefits of favourable crude oil prices in the international market.

Commenting, the government attributed the sustained rise in crude oil production to improved operational stability across major producing assets and the absence of major pipeline disruptions during the period under review.

In a statement issued by its Head of Media and Corporate Communications, Eniola Akinkuotu, the commission said June marked the fourth consecutive month of production growth, signalling a gradual recovery of Nigeria’s upstream sector after years of output losses linked to crude oil theft, pipeline vandalism and operational challenges.

The NUPRC said the improved performance was driven by consistent production activities across key oil assets, better crude evacuation efficiency and improved production uptime.

“The improved performance was primarily driven by stable production operations across most producing assets and the absence of any major pipeline outages during the period under review.

“This enhanced operational stability supported improved production uptime and crude evacuation efficiency. Although a limited number of assets experienced short-duration operational shutdowns, the overall impact on national production was minimal.

“In addition, scheduled turnaround maintenance activities were effectively managed and completed without significant disruption to production operations,” the commission stated.