A recent report by the Organization of Petroleum Exporting Countries, OPEC, says Nigeria has reclaimed its position as the top crude oil producer in Africa.
This is coming few weeks after President Bola Tinubu’s assumption of office and the removal of petrol subsidy.
In May 2023, Nigeria recorded a daily crude oil production of 1.184 million barrels, surpassing Libya, which produced 1.158 million barrels per day, and Angola, which had 1.111 million barrels per day. Algeria followed with a daily output of 962,000 barrels.
The OPEC report highlighted not only Nigeria’s resurgence in oil production, but also shed light on the country’s economic growth.
It showed that Nigeria’s economy expanded by 2.4% year-on-year in the first quarter of 2023. However, the report attributes the slow growth to several factors, including a decline in crude oil output.
Notably, Nigeria experienced its first decline in crude oil production in April 2023, with OPEC reporting a daily output of 999,000 barrels.
Alongside the decrease in oil production, Nigeria faces various challenges in its economy, such as high inflation, import restrictions, and a decrease in business activity and consumer spending.
In April 2023, the annual inflation rate reached 22.2%, indicating a continued acceleration compared to 22% in March 2023. These factors, combined with a slowdown in the services, manufacturing, and agricultural sectors, contribute to the economic burden faced by Nigeria.
The new administration led by President Bola Tinubu aims to revitalize Nigeria’s oil and gas sectors through comprehensive reforms and extensive partnerships with the private sector.
A policy document on the country’s energy industry, released in May 2023, outlines the administration’s plan to boost oil and gas output and foster synergies between the energy sector and other key areas of the economy, with the goal of driving overall growth.