• Exports hit 24.42 Mbbls in August

Sopuruchi Onwuka

Nigeria’s crude oil and Natural gas production is expected to follow demand lead from growing number of small scalable refineries in the country, while new propositions for multiple modular refining projects forecast rising commercial incentive for producers to accelerate output.

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Nigerian oil output ticked down to 1.55 million barrels per day (mbpd) in August, from July’s 1.56 mbpd, according to figures published by the Organization of Petroleum Exporting Countries (OPEC). The figures are above Nigeria’s OPEC+ quota of 1.50 mbpd for the fifth successive month.

However, the Crude Oil and Condensate Production Report for August 2025, released by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) showed the industry produced crude oil and condensates at daily average of 1.63 million barrels per day (bpd). The figure comprises 1.43 mbd of oil and 197,229 bpd.

Oracle Intelligence reports that whereas crude oil and condensate are mostly accounted collectively in production volumes, the two commodities are different, separate and distinct in character from one another. However, both crude oil and less volatile condensate could be used for same or similar purposes. They are also mostly blended to produce a lighter refinery feedstock.

Pundits tracking crude oil and condensate production for the global market forecast that Nigeria’s oil output would increase in 2025, reaching its highest level since 2020.

The production jump, according to analysts at Spain based Focus Economics stat that Nigeria’s upstream liquids output would be driven by the increasing local demand from local refineries including the Dangote refinery, Waltersmith’s Ibigwe refinery and Aradel’s Ogeble refinery among others. New refinery projects that have scaled regulatory approvals are also expected to also underpin crude demand in Nigeria, prompting an increase in production.

The production growth forecast comes with downside risk of precarious security situation and renewed turmoil in the oil-producing Niger Delta.

Already, the government recently signed a production-sharing contract with TotalEnergies and its local partner, South Atlantic Petroleum, for two offshore blocks in a bid to boost exploration and attract investment under Nigeria’s new oil framework.

In its latest industry output report, the NUPRC declared that the Nigerian upstream petroleum industry pushed significant 24.42 million barrels of hydrocarbon liquids into the domestic and foreign markets in the month of August, 2025.

The petroleum industry, Oracle Intelligence reports, is struggling with presidential mandate to boost output by over a million barrels per day to meet the ambitious 2.06 mbd template for the 2025 fiscal plans. The budget also hinges on oil price of $75 per barrel, a target the market has also failed to meet despite the sentiments surrounding Israel-Iran conflict and raging Russia-Ukraine war.

Focus Economics reported that energy complex led August’s price decline as OPEC+ said that it would raise output for the sixth straight month in September. Moreover, U.S. natural gas prices fell on rising output and expectations of cooler weather in the late summer.

Both unmet targets joint create a huge deficit in Nigeria’s 2025 budget and opened the door for the government to embark on another round of borrowing weakening the measures already deployed against rising inflation in the country.

Official figures show that inflation decelerated to 21.9% in July, from June’s 22.2%, trailing a falling trend as annual average inflation dipped to 25.6% in July from 26.6% in June. Core inflation fell to 21.4% in July from June’s 22.4%. The figures, according to official statistics, are primarily driven by lower price pressures for housing, utilities and transportation.

On the gloom side, consumer prices rose 1.99% in July over the previous month, the highest reading since March; accelerating from June’s 1.68% increase.

“In the medium term, Nigeria’s growth predictions remain modest, driven by the non-oil sector, including fintech and digital services. However, sustaining growth will require bold economic reforms, including fixing the foreign exchange system, improving electricity supply, and creating a more business-friendly regulatory environment. Without these changes, Nigeria risks falling further behind in Africa’s economic race,” analysts warn.