Africa (Commonwealth Union) _ Nigeria’s oil importation significantly declined in the second quarter of 2024, dropping by $1.52 billion to $2.79 billion, a 35 percent decrease from the previous quarter’s $4.31 billion. The Central Bank of Nigeria’s (CBN) quarterly report for Q2 2024 attributes this reduction to sweeping economic adjustments following the removal of fuel subsidies under President Bola Tinubu’s administration.
The report highlights broader trends in Nigeria’s import dynamics, revealing an overall contraction in merchandise imports. The total value of imports fell by 20.59 percent, dropping to $8.64 billion from $10.88 billion in Q1 2024, with reduced oil imports playing a central role in this decline. Additionally, non-oil imports contracted by 11 percent to $5.85 billion, making up 67.72 percent of total imports, with oil imports accounting for the remainder.
However, as domestic oil production faces continued disruption, the economic landscape for Nigeria’s oil and gas sector grows increasingly complex. The report indicates that Nigeria’s crude oil production decreased by 4.51 percent to 1.27 million barrels per day (mbpd) in Q2 2024, down from 1.33 mbpd in Q1. This production shortfall is largely attributed to persistent oil theft and illegal refining activities in the Niger Delta, resulting in losses across critical oil streams such as Forcados, Bonny, Qua-Iboe, Escravos, and Brass. Consequently, Nigeria’s output fell short of its OPEC quota of 1.58 mbpd by a notable 308,000 barrels per day.
Despite the production decline, rising global crude prices offered some relief. Nigeria’s Bonny Light crude rose to $86.97 per barrel in Q2 2024, providing a moderate increase in export revenue. Crude oil and gas exports made up 87.38 percent of Nigeria’s total export earnings during this period, though receipts saw a slight dip from $12.42 billion in Q1 to $12.18 billion.
The CBN also disclosed a total of $2.97 billion released to oil sector players for petroleum product imports, underscoring the cost-intensive nature of Nigeria’s reliance on imported fuel amid ongoing structural reforms. The report ultimately portrays a challenging yet evolving landscape for Nigeria’s oil sector as the country balances subsidy reform, production issues, and shifting global oil dynamics.
