Nigeria, Africa’s largest oil producer, recorded the slowest GDP growth in the oil sector in 2024, according to the National Bureau of Statistics (NBS).
Nigeria, Africa’s largest oil producer, recorded the slowest GDP growth in the oil sector in 2024, according to the National Bureau of Statistics (NBS). Growth in the oil sector fell sharply from 10.15% in the previous quarter to 5.17% in the third quarter.
Despite this slowdown, crude oil GDP showed significant improvement, rising from -7.64% in Q3 2023 to 14.87% in Q3 2024. Average daily oil production also increased, reaching 1.47 million barrels per day (mbpd) in Q3 2024, up from 1.45 mbpd in Q3 2023 and 1.41 mbpd in Q2 2024.
Nigeria had set a 2024 production target of 1.78 mbpd and a benchmark price of $77.96 per barrel in its budget but has struggled to meet these goals. According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), production in October dropped to 1.5 mbpd, marking a quarterly low.
The country continues to face significant challenges from large-scale oil theft, which hampers production and reduces government revenue. Authorities estimate that illegal pipeline connections and other criminal activities cause daily losses of 200,000 to 400,000 barrels.
According to NNPC CEO Mele Kyari, more than 8,600 illegal refinery sites have been dismantled, and 5,913 illegal pipeline connections have been removed since a crackdown began in 2022. However, over 1,000 illegal connections remain active, with new ones regularly reinstalled.
Despite these challenges, analysts at Cordros Securities foresee a gradual recovery in Nigeria’s oil sector, bolstered by government efforts to curb oil theft and improve pipeline security. Combined with resilience in the service sector, these measures are expected to keep the economy on a growth trajectory for the remainder of the year.
