Nigeria, Africa’s top oil producer, recorded its slowest oil sector GDP growth in 2024, according to the National Bureau of Statistics (NBS). Growth in the oil sector fell to 5.17% in the third quarter, a significant drop from 10.15% in the previous quarter.
Despite the slowdown, crude petroleum GDP showed notable improvement, rising to 14.87% in Q3 2024 from 7.64% in the same period of 2023. Average daily oil production also increased to 1.47 million barrels per day (mbpd) in Q3 2024, compared to 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. October’s production dropped to 1.5 mbpd, marking a three-month low, according to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
The country continues to face significant challenges from large-scale oil theft, which has hampered production and government revenues. Authorities estimate losses of 200,000 to 400,000 barrels daily due to illegal pipeline connections and theft.
Since a crackdown on illegal refineries began in 2022, over 8,600 sites have been deactivated, and 5,913 illegal pipeline connections have been removed, according to NNPC CEO Mele Kyari. However, over 1,000 illegal connections persist, with new ones being reestablished regularly.
Despite these challenges, analysts at Cordros Securities project gradual recovery in Nigeria’s oil sector, supported by government efforts to curb oil theft and improve pipeline security. Combined with resilience in the services sector, these measures are expected to keep the economy on a growth trajectory for the remainder of the year.
