Nigeria has once again fallen short of its oil production target, recording an estimated $3.6 billion revenue deficit in the first five months of 2026 despite rising crude oil prices and improved output levels.
Although the country’s oil production increased to 1.7 million barrels per day (bpd) in May, up from 1.52 million bpd in April, it remained below the 1.84 million bpd benchmark set in the 2026 budget.
This marks the fifth consecutive month Nigeria has failed to meet its production target, raising concerns about the country’s ability to achieve projected oil revenue goals despite favourable market conditions.
Nigeria’s oil sector has repeatedly projected production levels of up to two million barrels per day in 2026. However, both industry projections and the official budget benchmark have remained out of reach for much of the year, even with condensates included in total output figures.
Data released by the Nigerian Upstream Petroleum Regulatory Commission shows that production shortfalls persisted throughout the first five months of the year:
- January: Production stood at 1.63 million bpd, resulting in a shortfall of 212,539 bpd.
- February: Output dropped to 1.48 million bpd, creating a deficit of 356,046 bpd.
- March: Production rose slightly to 1.55 million bpd but still fell short by 293,907 bpd.
- April: Output reached 1.66 million bpd, leaving a gap of 176,587 bpd.
- May: Production improved to 1.7 million bpd but remained 140,000 bpd below the benchmark.
The cumulative production deficit over the period amounted to approximately 1.36 million barrels, contributing to an estimated $3.6 billion loss in projected oil revenue.
Among Nigeria’s major production streams, Bonny Terminal recorded the highest output with 293,870 bpd, followed closely by Forcados Terminal at 289,900 bpd.
Other top contributors included:
- Qua Iboe – 173,360 bpd
- Escravos Oil Terminal – 135,470 bpd
- Odudu (Amenam Blend) – 63,250 bpd
The NUPRC attributed the improvement in production to stable operations, the completion of scheduled maintenance programmes, and the absence of major pipeline or facility disruptions during the reporting period.
Despite concerns about production performance, the Organization of the Petroleum Exporting Countries maintained a positive outlook for Nigeria’s economy.
According to OPEC, Nigeria’s economy expanded by 3.9 percent year-on-year in the first quarter of 2026, nearly matching the four percent growth recorded in the final quarter of 2025.
The organisation noted that growth was largely driven by sectors such as:
- Agriculture
- Manufacturing
- Construction
- Information and communication
- Trade
- Finance and insurance
Business activity also strengthened, with the Purchasing Managers’ Index (PMI) rising to 54.1 in May, its highest level since August 2025.
OPEC credited ongoing reforms, increased infrastructure investments, stronger trade conditions, rising domestic refining capacity, and improved macroeconomic stability for the positive outlook.
However, the organisation warned that persistent oil production challenges could continue to affect government revenue generation if not addressed.
While Nigeria’s economic indicators are showing signs of improvement, industry observers say achieving production targets remains critical to funding government spending plans and meeting revenue projections outlined in the 2026 budget.
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